Carbonylation of renewable 5-hydroxymethylfurfural (HMF) under aqueous phase catalytic conditions using the water soluble catalyst Pd(TPPTS) 3 (TPPTS = sodium salt of trisulfonated triphenylphosphine, P(C 6 H 4 -m-SO 3 Na) 3 ) was investigated, Pd(TPPTS), was easily prepared in situ via complexation of PdCl 2 in an aqueous TPPTS solution and reduction with carbon monoxide. Using the Pd(TPPTS) 3 catalyst at 70°C, 5 bar CO pressure and [Pd] = 150 ppm chemoselective carbonylation of HMF was observed to yield 5-formylfuran-2-acetic acid (FFA) as the sole carbonylation product; the only by-product was 5-methylfurfural (MF). The formation of MF under these conditions amounts to a new type of catalytic and very selective reduction with CO, formally equivalent to hydrogenolysis of an alcohol group without using H 2 . This is surprising since one would expect the water gas shift reaction. Both the activity and selectivity of HMF carbonylation were strongly influenced by the TPPTS/Pd molar ratio; maximum efficiency being observed for TPPTS/Pd = 6. The nature of the anion of the added acid markedly influenced the selectivity. Acids of weakly or non-coordinating anions, such as H 3 PO 4 , CF 3 COOH, p-CH 3 C 6 H 4 SO 3 H, H 2 SO 4 , and HPF 6 afforded mainly carbonylation. The selectivity decreased dramatically with acids of strongly coordinating anions such as HBr and HI. With the latter the only product observed was MF. Replacement of TPPTS by ligands containing less -SO 3 Na groups such as disulfonated triphenylphosphine (TPPDS) or disulfonated tris(p-fluorophenyl)phosphine (TFPPDS) gives rise to a dramatic drop in the catalytic activity. Using palladium catalysts modified with monosulfonated triphenylphosphine (TPPMS) only traces of FFA and MF were obtained. Pd(TPPTS) 3 in aqueous media similarly catalyses the selective carbonylation of benzyl alcohol to phenylacetic acid. In sharp contrast, classical hydrophobic Pd/PPh 3 catalysts are inactive in this carbonylation reaction in organic solvents. A catalytic cycle is proposed to explain the observed results.