ADB predicts unstable Pacific economies in 2015-2016 [1]
Wednesday, July 15, 2015 - 20:24
The economies of 14 developing member countries in the Pacific are expected to be unstable during 2015-2016, according to Pacific Economic Monitor Midyear Review, launched by the Asian Development Bank in Suva today, 15 July.
Pacific economies are expected to grow by 9.9% in 2015 then shrink to 5% in 2016.
“. . . the first full-year of natural gas exports from Papua New Guinea, along with strong tourism activity in Fiji and Palau, are seen to sustain growth across the Pacific at close to a double-digit rate in 2015,” said Xianbin Yao, Director General of ADB’s Pacific Department.
The Fijian economy is projected to accelerate in 2016 with the expected commencement of development projects stemming from Fiji’s re-engagement with development partners.
Economic growth is also expected to accelerate in the Cook Islands and the Marshall Islands because stimulus from development partner-funded infrastructure projects.
According to the report, the reconstruction work after recent climate disasters is helping to support economic recovery in Samoa, Solomon Islands and in Tonga.
In Vanuatu, the impacts of Cyclone Pam are expected to see the economy contract in 2015, due to lost agricultural output and an expected decline in tourist arrivals.
The destruction of houses and food crops in the states of Chuuk and Yap in the Federated States of Micronesia by Typhoon Maysak lowered agricultural output, but it is expected to be offset by greater construction activity.
The Pacific Economic Monitor Midyear Review alerted that though measures to reduce the impacts of storms, including early warning, evacuation systems and climate proofing of infrastructure, have delivered benefits, “but these must be complemented by good governance and sound macroeonomic management to ensure development gains are maintained after disasters.”