Tonga’s inter-island ferry MV ‘Otuanga’ofa which is still docked in Auckland for maintenance is now expected to return to Tonga next week, said the Prime Minister Hon. Hu’akavameiliku during a press conference on 16 March.

The Prime Minister said he was glad to have all the faults be repaired, while it’s still docked there.

In addition, New Zealand Maritime is working on the final inspections of the ferry before they release the vessel to return.

“Inspectors from Tonga had also informed New Zealand Maritime of other pressing issues to address. We hope that it arrives soon, to help transport our people to the outer islands,” he said.

In regards to travellers and students from the remote islands of the two Niuas, the PM said that they were planning to send another ferry there to transport people.

But Niua asked to leave to their island ferry and we gladly agreed, said the PM.

Tonga's State Owned Enterprises

The press conference also had Laure Darcy, a State-Owned Enterprises (SOE) Reform/PPP Specialist of the Pacific Private Sector Development Initiative under ADB present to answer questions, after the launch of a ‘2023 Finding Balance study’ earlier in the morning.

On how Tonga fared in comparison with the other nine countries they did the study on, she said one the headline findings is that Tonga has one of the most robust governance frameworks for SOE in the region.

In regards to return on equity, Tonga is the fourth highest among the samples, she said.

“We cover Polynesia, Melanesia, and Micronesia so everyone is moving towards commercializing their SOE and want them to operate like private businesses, in other words to be efficient and trying to protect the investment that the state has made and if you operate commercially the services that you deliver to your customers will improve. The two are linked.

Tonga has one of the best governance frameworks and by that we mean everyone understands their role, the government is the shareholder, the board are directors as stewards and the CEO are in management, so the role is very well defined, and there is accountability….That’s the kind of framework that you want to see, a lot of countries don’t have it but you have it.

The other part is Tonga's SOE financial performance, she said everyone took a hit during COVID 19.

“We covered from 2015 to 2020, and in every country, we saw performance decrease in 2020 but there was rebound in 2021.

“Tonga’s SOE has been really good at cutting costs and responding to COVID, so as revenue dropped costs were curtailed therefore the loss and probability was mitigated because so they reacted as you want them to react in a commercial way,” she said.

“But for the overall headline numbers, Tonga’s SOE average return on equity is 4.7 percent during that period, which is about the fourth highest among the sample, you’re doing better than Samoa, Vanuatu, PNG than a number of larger economies, but not as well as Fiji etc. Essentially you're up there on the upper tier,” she said.

She said a lot goes into those numbers, a lot has got to do how government reacted to COVID, so in some countries a lot of money thrown into their SOE, while in other countries that was not the case. In Tonga SOE because they were already commercially oriented, were able to shoulder some downturn themselves, so you did not see a lot of govenrment bailing out happening.”

She said in the 10-years of us publishing those studies, we do often point to Tonga as having a very robust legal and regulatory framework in SOE, in which other countries do look to as a good model to emulate.”