The Government of the Federated States of Micronesia is concerned about the increase in geopolitical tensions between China and the United States, following the Speaker of the House of Representatives, Nancy Pelosi's visit to Taiwan.
Beijing has seen the move by Pelosi as an attack on its claims of sovereignty over self-ruled Taiwan.
Photo: HANDOUT
It has announced it is carrying out new military exercises in the Yellow Sea near South Korea until the middle of August.
The expansion follows a barrage of Chinese military drills which have encircled Taiwan for the past few days, involving fighter jets, warships and missiles.
China has also has paused cooperation with Washington on several key areas, including climate change, dialogue on the military, and combating international crimes.
The FSM government is urging both countries "to de-escalate tensions" and to re-establish cooperation on issues of international importance, stressing that climate change is the greatest threat facing the world.
The Pacific Islands Forum member said there can be no solution to common problems unless China and the US choose to cooperate.