Page 12 - IB Jan 2018

2018 Outlook At the ballot Professor Brij Lal on Fiji Economy IMF calls on Fiji to reopen
credit data P25
elections P14

From Page 11 After years of changing prime ministers
“In contrast, the prolonged drought through no confidence motions, the Salwai
conditions in 2015 and in the early part of government seems to be holding thus far.
2016 weighed on agriculture and fisher- It is a far cry from leaders that had gone
ies, while the export of logs was hampered before him. For the years 2008 and 2012
by weak demand from China. for example, Vanuatu changed its PM eight
“Together with the weaker exchange times through confidence votes in parlia-
rate, lower domestic food supply pushed ment. The late Edward Natapei who won
up food prices, with overall inflation rising the Prime Ministership during the 2008
to 3.3 per cent in 2016 compared with a elections was ousted three times during
small decrease in 2015,” said the UNES- that period.
CAP report. Apart from worrying about his popular- The only other threat Samoa needs to
“Economic growth is projected to be 2.5- ity, 2018 will see PM Salwai introducing keep at bay is the health of Tuilaepa. He
3 per cent during the period 2017-2018. one of the controversial policies of his caused a scare middle of last year when he
Resource-based sectors would continue to government, shifting from indirect tax fell ill and had to be airlifted to New Zea-
be the main growth driver. The country’s to direct taxation through the imposition land. The medical emergency prompted
medium-term economic development of income and corporate taxes. Despite a member of his ruling party to warn
would benefit economic diversification opposition from businesses in Vanuatu, party members to refrain from jostling for
as well as productivity enhancement in including the unprecedented criticism from leadership in Tuilaepa’s absence. He will
such sectors as logging, mining and tuna the UN’s International Labour Organisa- be 73 this year and 2018 will also mark
processing. Among other areas, policy tion, Salwai’s cabinet endorsed the taxa- Tuilaepa’s 20th year as Prime Minister, a
efforts could focus on providing support tion measures last August and intend to feat that will be hard to match.
for small enterprises, linking subsistence implement them in July this year. Through shrewd stewardship of the
farmers with market opportunities and Reconstruction works after the devas- economy, Samoa has been registering
streamlining business regulations and tations of Tropical Cyclone Pam in 2015 impressive growth rates, surging to 6.4
trade facilitation processes.” assisted by the growth in cruise line tour- per cent in 2016 mainly due to higher
ism are key drivers of economic growth tourism earnings and capital investments
Vanuatu in Vanuatu. The economy was projected including expansions with Chinese aid to
The question 2018 ushers in for this to have grown by 3.8 per cent by the the main terminal building at Faleolo
Melanesian island nation is how long will end of 2017. International Airport outside Apia.
Prime Minister Carlot Salwai hold on as “Increased tourism revenue, higher “Moderate expansion in agriculture
leader of Vanuatu? agricultural production and additional and tourism is expected to support the
He has survived two confidence motions infrastructure projects are some of the Tuilaepa economy, while a new submarine cable
already in the national parliament, the lat- expected drivers of growth. In contrast, investment would boost output in the
est one being last month just before MPs capacity constraints and external funding communications sector. On the downside,
went into the Christmas recess. He gaps remain and could lead to delays in the country’s largest manufacturing em-
easily defeated this motion 37 votes implementing major infrastructure proj- ployer [was] expected to close its opera-
to 13 and what contributed somewhat ects. In this regard, comprehensive tax tions in 2017. Given the country’s narrow
to his victory is some last minute reform is already under way, including economic base, public policies could focus
manoeuvring that saw the Graon mo Salwai the introduction of income and corpo- on promoting such sectors as agriculture
Jastis Party of charismatic Ralph Re- rate taxes. Other policy issues include and high-value-added industries,” said
genvanu offered 3 senior cabinet positions land reform, productivity enhancement in the UNECAP Social and Economic Review
just before the vote. Regenvanu himself fisheries and agriculture and the need for report.
becomes the new foreign minister, taking public investment to crowd in business
over from former radio and TV announcer investment.” Tonga
Bruno Leingkone. Vindicated by a fresh mandate from the
It was only after the vote that Regenva- Samoa electorate in a snap election ordered by the
nu, an Australian educated anthropologist Voters in Samoa won’t be going to the King, Prime Minister ‘Akilisi Pohiva gets a
who was head of the Museum of Vanuatu polls until 2021 so this new year will see second chance at creating his legacy as the
before entering politics, revealed the op- the ruling party of Prime Minister Tuilaepa pro-democracy leader of the kingdom. All
position’s attempt to lure him across by Aiono Sailele Malielegaoi continue to rule his successful candidates voted as a bloc
offering him the PM position. unchallenged. when the legislature convened to elect a
Even the threat of slander from anony- Prime Minister last month, and with the
mous bloggers has been taken care of vote comes another four years of Pohiva
with the introduction late last year of a at the helm.
law criminalising libel. Its said the law At least that’s what the Tongan Consti-
was specifically brought back to life by tution dictates. Yet the same constitution
PM Tuilaepa to shut down one particular also gives the power to the King to act in
blogger that uses the name O Le Palemia the way that he did mid last year, by dis-
that posts articles claiming corruption and solving the legislature and calling for fresh
nepotism against the ruling Human Rights elections. This lesson hopefully won’t be
Protection Party. lost on the pro-democracy campaigner
as he tries to come to grips with sluggish

12 Islands Business, , January 2018