High Quality Content by WIKIPEDIA articles! Japanese settlement in what now constitutes modern-day Federated States of Micronesia (FSM) dates back to the end of 19th century, when Japanese traders and explorers settled on the central and eastern Carolines, although earlier contacts can not be completely excluded. After the islands were occupied by Japan in 1914, a large-scale Japanese immigration to them took place in the 1920s and 1930s. The Japanese government encouraged immigration to the islands belonging to the South Pacific Mandate to offset demographic and economic problems facing Japan at that time.