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Fiji New Caledonia Samoa Solomon Islands Tonga Vanuatu COUNTRY REPORT Pacific Islands: Fiji New Caledonia Samoa Solomon Islands Tonga Vanuatu December 2000 The Economist Intelligence Unit 15 Regent St, London SW1Y 4LR United Kingdom The Economist Intelligence Unit The Economist Intelligence Unit is a specialist publisher serving companies establishing and managing operations across national borders. For over 50 years it has been a source of information on business developments, economic and political trends, government regulations and corporate practice worldwide. The EIU delivers its information in four ways: through our digital portfolio, where our latest analysis is updated daily; through printed subscription products ranging from newsletters to annual reference works; through research reports; and by organising conferences and roundtables. The firm is a member of The Economist Group. London New York Hong Kong The Economist Intelligence Unit The Economist Intelligence Unit The Economist Intelligence Unit 15 Regent St The Economist Building 25/F, Dah Sing Financial Centre London 111 West 57th Street 108 Gloucester Road SW1Y 4LR New York Wanchai United Kingdom NY 10019, US Hong Kong Tel: (44.20) 7830 1007 Tel: (1.212) 554 0600 Tel: (852) 2802 7288 Fax: (44.20) 7499 9767 Fax: (1.212) 586 1181/2 Fax: (852) 2802 7638 E-mail: [email protected] E-mail: [email protected] E-mail: [email protected] Website: http://www.eiu.com Electronic delivery This publication can be viewed by subscribing online at http://store.eiu.com Reports are also available in various other electronic formats, such as CD-ROM, Lotus Notes, online databases and as direct feeds to corporate intranets. For further information, please contact your nearest Economist Intelligence Unit office London: Jan Frost Tel: (44.20) 7830 1183 Fax: (44.20) 7830 1023 New York: Dante Cantu Tel: (1.212) 554 0643 Fax: (1.212) 586 1181 Hong Kong: Amy Ha Tel: (852) 2802 7288/2585 3888 Fax: (852) 2802 7720/7638 Copyright © 2000 The Economist Intelligence Unit Limited. All rights reserved. Neither this publication nor any part of it may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of The Economist Intelligence Unit Limited. All information in this report is verified to the best of the author's and the publisher's ability. However, the EIU does not accept responsibility for any loss arising from reliance on it. ISSN 1460-7077 Symbols for tables “n/a” means not available; “–” means not applicable Printed and distributed by Redhouse Press Ltd, Unit 151, Dartford Trade Park, Dartford, Kent DA1 1QB, UK 1 Contents 3 Summary The region 6 Outlook for 2001-02 6 The political scene 8 Economic policy and the economy Fiji 10 Political structure 11 Economic structure 11 Annual indicators 12 Quarterly indicators 13 Outlook for 2001-02 14 The political scene 16 Economic policy and the economy New Caledonia 19 Political structure 20 Economic structure 20 Annual indicators 21 Outlook for 2001-02 22 The political scene 24 Economic policy and the economy Samoa 27 Political structure 28 Economic structure 28 Annual indicators 29 Quarterly indicators 30 Outlook for 2001-02 31 The political scene 32 Economic policy and the economy Solomon Islands 34 Political structure 35 Economic structure 35 Annual indicators EIU Country Report December 2000 © The Economist Intelligence Unit Limited 2000 2 36 Quarterly indicators 37 Outlook for 2001-02 38 The political scene 40 Economic policy and the economy Tonga 42 Political structure 43 Economic structure 43 Annual indicators 44 Quarterly indicators 45 Outlook for 2001-02 45 The political scene 47 Economic policy and the economy Vanuatu 49 Political structure 50 Economic structure 50 Annual indicators 51 Quarterly indicators 52 Outlook for 2001-02 53 The political scene 54 Economic policy and the economy List of figures 13 Fiji: gross domestic product 13 Fiji: Fiji dollar real exchange rates 30 Samoa: gross domestic product 30 Samoa: Tala real exchange rates 37 Solomon Islands: gross domestic product 37 Solomon Islands: Solomon Islands dollar real exchange rates 45 Tonga: gross domestic product 45 Tonga: Tonga dollar real exchange rates 53 Vanuatu: gross domestic product 53 Vanuatu: vatu real exchange rates EIU Country Report December 2000 © The Economist Intelligence Unit Limited 2000 3 Summary December 2000 The region Outlook for 2001-02 Most island countries face a difficult year ahead. However, the spill-over from events in Fiji and Solomon Islands has not been as serious as first expected. The political scene The Pacific Islands Forum leaders have signed the Biketawa Declaration, with a commitment to upholding democratic processes. The Forum will respond to future crises more effectively. China and Taiwan pose a potential problem as they vie for influence. China has reminded island governments of the one- China principle. Taiwan supporters have suggested it could have Forum mem- bership. The Pacific patrol boat programme has been extended by 25 years. Economic policy and the Police chiefs have warned of increasing activity by organised crime. A new economy broadband cable network will improve Internet and data services in the region. China has agreed to fund a trade office in Beijing. Certification of aquarium ornamentals may be on the way. Fiji Outlook for 2001-02 The country has sunk deeper into legal and political turmoil. The economic outlook is still disastrous but not as bad as first feared. The political scene Police are reportedly investigating dozens of prominent people. George Speight has been charged with treason. A High Court judge has ordered the reinstatement of the deposed government. The legal profession is riven by the political strife. A Commonwealth study group has criticised the chief justice. Elections are likely to be held in 2002. The prime minister has said that indigenous Fijians want stronger guarantees. Economic policy and the The 2001 budget seems very much like the product of technocrats. A budget economy deficit of 4% of GDP has been targeted. Estimates of economic growth have been revised from –15% to –8%. The government wants markets to function better. The civil service is to be reformed and information technology development encouraged. New Caledonia Outlook for 2001-02 France continues a crucial balancing role in local politics. In generational terms, the independence movement may have an advantage. Business is concerned about economic prospects. EIU Country Report December 2000 © The Economist Intelligence Unit Limited 2000 4 The political scene Jacques Lafleur has decided not to depart the political scene and will fight on. Pro-independence parties have to accept new views and the dissident “groupe UC au Congrés”, although there is no change in UC management. The new overseas minister for France visited in October to open the eighth Pacific arts festival. Economic policy and the A government wage decision has undermined its social pact. The dispute was economy resolved quickly after Jacques Lafleur spoke his mind. A fatal helicopter crash has rocked the community and the nickel industry. The FF1bn (US$137m) share transfer of Eramet and SLN shares has been formalised. A new agency will manage air rights and the government’s Air Calédonie International (AirCalin). Samoa Outlook for 2001-02 The elections in 2001 are attracting more attention. Following the recent events in Fiji and Solomon Islands, indigenous rights are likely to be a prominent issue, promoted by the new Samoa Progressive Political Party (SPPP). The major parties are vulnerable to such a populist attack. The political scene The opposition has been granted access to government media, but the government does not seem willing to comply with the court order. Questions have been raised over Polynesian Airline finances. A new political party, SPPP, has been launched with an emphasis on indigenous and religious issues. The National Council of Churches has demanded that the constitution be changed to control the number of churches in Samoa. Economic policy and the Samoa’s tourism industry has benefited from the troubles in Fiji and Solomon economy Islands. A new fisheries management regime has been introduced to limit the number of boats. Government authorities have seized US$14m suspected of being tainted money. The Asian Development Bank has backed a major upgrade of the education system. The first phase of the government’s infrastructure asset management project has been completed with the reopening of Faleolo international airport. Solomon Islands Outlook for 2001-02 Financing the peace agreement could prove tricky as the government has no money and few prospects. Ethnic violence will remain a problem. Outlying regions may want a federation. The economic recovery will take a long time. The political scene A peace agreement was signed in October and conditions in Honiara have improved. Provincial financial arrangements will be reviewed. Taiwan has been approached for money after clarification of “misunderstandings” following talks with Beijing representatives. Economic policy and the A new fisheries agreement with Taiwan came into force in October. The EU is economy now the biggest aid donor with the agreement of a US$200m grant. Air Niugini EIU Country Report December 2000 © The Economist Intelligence Unit Limited 2000 5 has resumed service. According to the Central Bank of the Solomon Islands (the central bank), the economic crunch preceded the political chaos. Tonga Outlook for 2001-02 The appointment of a new deputy prime minister will provide important signals as to the prime minister, Prince Lavaka Ata Ulukalala’s, domestic intentions. The political scene The prime minister mused on broad policy at the UN millennium summit. Tonga is moving to more international involvement. The deputy prime minister, Langi Kavaliku, has retired. The government has decided to sign the world heritage convention. Economic policy and the Policy-makers have been given new GDP figures. The government hopes to economy bring greater stability to the squash pumpkin trade and increased security for squash growers.
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