The Tongan economy's only hope of surviving the global financial crisis is to be able to adapt and to exploit global economic changes, Tonga's Minister of Finance, Hon. Afu'alo Matoto said in his opening address of the "Tonga Update 2009" at the Fa'onelua Convention Centre, Nuku'alofa on Friday November 20.

He pointed out that the Tonga Update program spotlighted five different but important aspects of Tonga: the Constitutional Reform, the Seasonal Workers Program, Climate Change and Telecommunications. But after making a comment of each of those topics, he concluded that the lesson that Tonga must learn as a nation "is. . . how to adapt to threats and opportunities, particularly global ones.

"I consider that how well we can survive a crisis is not a suitable measure of our progress. Rather, how well Tonga learns how to exploit international good times should be the indicator of our progress.

"That is, Tonga will cease being vulnerable when we learn to move up with the global economy, rather than simply learning how not to follow it down."

Sea level rise

Afu'alo also said that Constitutional Reform is significant and will have far reaching implications.

"But if, however, 50 years from now, rising sea levels have shrunk Tonga from 170 to 30 islands . . . hindsight will tell us that climate change is the most important event of our times."

On the issue of the global financial crisis, he warned of a premature celebration by Tonga of the robustness of its economy to "weather the world's greatest economic downturn in sixty years without entering a recession. . . .While we have survived the worst of the current crisis, the Tongan economy remains vulnerable.

"Put it another way, there is a risk of a tragic progression of both our economy and our islands, as to which one may sink first," he said.

Constitutional Reform

Tonga Update 2009 included a panel discussion on Constitutional Reform. The panelists were Dr Malakai Koloamatangi, from the University of Centerbury; 'Alisi Taumoepeau, Tonga's former Minister of Justice; and Rev. Simote Vea from the Tongan Human Rights and Democracy movement.

The final report of the Constitutional and Electoral Reform Commission was published on November 5 and one of the recommendations of the Commission is for a minority government with 10 Cabinet Ministers, including the Prime Minister in a 26 members Legislative Assembly.

The issue of a minority government became an interesting issue for discussion. Malakai was neither for or against the idea, but pointed out that the 10 Cabinet Ministers will work very hard to pass anything in parliament.

The Attorney General John Cauchi expressed his support of the idea and did not think it would cause any upheaval in the Legislative Assembly.

The former Minister of Justice 'Alisi Taumoepeau also expressed her support of a minority government and reminded the gathering that Tongan had been having a minority government.

The unanswered question when the morning session broke up for coffee was, "but wasn't that what the political reform was all about - to get rid of the minority government."

Economy

The one day meeting included a presentation by Tonga's former Minister of Finance, Siosiua 'Utoikamanu, of his survey of the Tongan economy.

Siosiua found that despite the negative impact of the global financial crisis, Tonga Gross Domestic Product growth remain positive "as the Subsistence Sector is sheltered and the foreign financial assistance has supported construction activity and permitted an expansionary stance of fiscal policy." He also reported that inflation was back to a low level and the budget and the balance of payments were showing overall surpluses.

The Tonga Update 2009 was organized by the Crawford School of Economics and Government, at the Australian National University, and was supported by AusAID.