Boosting Connectivity Will Strengthen Services, Lift Growth in Pacific — ADB

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MANILA, PHILIPPINES (27 July 2017) — Enhanced connectivity through information and communication technologies (ICTs) as well as transport infrastructure development are some of the efforts needed to increase economic opportunities and create better access to goods and social services in the Pacific, says the latest issue of the Asian Development Bank’s (ADB) Pacific Economic Monitor launched today.

“Improved ICT connectivity is no longer a luxury but a necessity in the Pacific,” said Carmela Locsin, Director General of ADB’s Pacific Department. “Pacific economies are looking to improve economic integration through ICTs and transport networks, and by promoting greater competition and private investment.”

The latest Monitor reports a drop in Pacific growth to 2.6% in 2016 from 8.3% in 2015, driven largely by the slowdown in Papua New Guinea (PNG). Recovery in the larger economies is expected to push average regional growth to 2.9% in 2017 and 3.3% in 2018. Price prospects for Pacific exports are mixed, however, coupled with a possible slowdown in inbound tourism.

The Monitor, ADB Pacific Department’s flagship economic publication, focuses on country issues as well as current and critical policy themes. Enhancing connectivity is the main theme of the latest issue — with the view of addressing Pacific countries’ remoteness, which is a fundamental constraint to economic development in the region. Advances in ICT, including investments in mobile telephones and submarine fiber optic cables, will not only reduce the limitations imposed by geography, but also change the economic landscape of the Pacific. These technological advances will make physical distance far less of an obstacle to development.

The report suggests that an estimated 75% of Pacific economies will be connected to submarine cables in the next 2-3 years. ADB is working with the Cook Islands, Kiribati, Nauru, Palau, Samoa, and Tonga to help develop submarine cable projects.

In keeping with the connectivity theme, the Monitor explores broadband connectivity expansion in the Cook Islands and Tonga, telecommunications reforms and ICT growth in Fiji, and ICT regulation and competition in the North Pacific.

The Monitor discusses ADB’s long-running engagement with PNG, Kiribati, and Tuvalu on improving transport infrastructure. It highlights the importance of reforms to state-owned enterprises in Samoa, as well as to private investment in Timor-Leste to improve connectivity. The importance of providing infrastructure maintenance in the region is also examined in the report, with reference to Nauru, Solomon Islands, and Vanuatu.

The Monitor continues to feature briefs exploring topical policy issues relevant to the region. A piece on improving connectivity through trade policy in Timor-Leste provides an interesting case study on the limits of liberal trade policies. Another examines ADB’s recent efforts to bring shipping services to remote areas in PNG and Solomon Islands. A model for sustainable and climate-resilient maritime connectivity in Nauru is discussed, and a special supplement highlights the need to improve labor market outcomes in the Pacific.

The Pacific Economic Monitor is a bi-annual review of economic developments and policy issues in ADB’s 14 developing member countries in the Pacific, and includes policy briefs on key policy issues and interests. In combination with the Asian Development Outlook series, ADB provides quarterly reports on economic trends and policy developments in the Pacific. The Monitor welcomes contributions of policy briefs from external authors and institutions.

ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, ADB is celebrating 50 years of development partnership in the region. It is owned by 67 members—48 from the region. In 2016, ADB assistance totaled $31.7 billion, including $14 billion in cofinancing.

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