How Does An Island Of Development Promote Economic Development A recently released report by the World Bank highlights the obstacles faced by the Pacific region’s remote island communities and underscores the significance of investing in human capital and livelihoods for fostering inclusive economic growth. Titled Archipelagic Economies: Spatial Economic Development in the Pacific, the report examines the complex challenges that Pacific governments must tackle in providing essential services and infrastructure to populations scattered across numerous islands spanning the vast expanse of the Pacific Ocean. The report offers practical recommendations to help countries address these challenges while promoting resilient and inclusive economic growth.
Lead author of the report, Robert Utz, World Bank Lead Economist for Fiscal Policy and Sustainable Growth, emphasized, “Many Pacific countries encounter significant hurdles in delivering services and connecting remote outer island communities. They face tough decisions concerning resource allocation and how to best utilize limited resources for the benefit of these communities. This report aims to provide Pacific governments, development partners, and decision-makers with evidence-based insights to evaluate options for fostering development in these outer islands, enabling them to contribute more substantially to the overall economic development of the entire country.”
The report outlines six key economic policy principles:
- Policy solutions for equitable improvements in living standards should consider the unique economic geography of the Pacific region.
- Development in outer islands should be assessed from a spatial perspective, taking into account interactions with the main island and the broader regional context.
- A balanced approach that combines investments in urban areas to accommodate migration from outer islands with support for outer island populations can yield better welfare and equity outcomes.
- Investments aimed at promoting economic growth should be guided by clear opportunities rather than a desire for equalizing economic prospects across islands.
- Given limited prospects for closing the economic gap between outer and main islands, priority should be given to investments that promote livelihoods and human development.
- Development interventions in outer islands should consider the intricate political economy of intra-island and outer island-main island relationships.
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Denton Rarawa, Senior Economic Advisor at the Pacific Islands Forum Secretariat, praised the report, stating, “This is an important and timely study. The ongoing COVID-19 crisis has underscored the need to address institutional, service delivery, and capacity gaps in Pacific nations. As we strive to achieve higher vaccination rates and begin planning for post-pandemic recovery, I believe this report offers valuable insights for the future of the Pacific, particularly in our efforts to ensure that no one is left behind.”
Archipelagic Economies is part of the World Bank’s Pacific Possible series, which previously examined opportunities for economic growth in Pacific Islands Countries across various sectors such as tourism, fisheries, and labor mobility between 2017 and 2018.
The World Bank collaborates with 12 Pacific countries, supporting 87 projects with a total commitment of US$2.09 billion across sectors such as agriculture, aviation and transport, climate resilience and adaptation, economic policy, education and employment, energy, fisheries, health, macroeconomic management, rural development, telecommunications, and tourism.
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