Information about Asia and the Pacific Asia y el Pacífico
Front Matter

Front Matter

Author(s):
Christopher Browne
Published Date:
August 2006
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Information about Asia and the Pacific Asia y el Pacífico
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© 2006 International Monetary Fund

Production: IMF, Multimedia Services Division, Creative Services

Cover design: Massoud Etemadi

The cover depicts a palm leaf and a map of selected Pacific islands.

Cataloging-in-Publication Data

Browne, Christopher, 1944—

Pacific Island economies / Christopher Browne — [Washington, D.C. : International Monetary Fund, 2006]

p. cm.

ISBN 1-58906-516-6

1. Islands of the Pacific — Economic policy. 2. Islands of the Pacific — Economic conditions. 3. Foreign exchange rates — Islands of the Pacific. 4. Emigrant remittances — Islands of the Pacific. I. International Monetary Fund.

HC681.B76 2006

Price: $25.00

Address orders to:

International Monetary Fund, Publication Services

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Tel.: (202) 623-7430 Telefax: (202) 623-7201

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Internet: http://www.imf.org

CONTENTS

The following conventions are used in this publication:

In tables, a blank cell indicates “not applicable,” ellipsis points (…) indicate “not available,” and 0 or 0.0 indicates “zero” or “negligible.” Minor discrepancies between sums of constituent figures and totals are due to rounding.

An en dash (—) between years or months (for example, 2005-06 or January-June) indicates the years or months covered, including the beginning and ending years or months; a slash or virgule (/) between years or months (for example, 2005/06) indicates a fiscal or financial year, as does the abbreviation FY (for example, FY2006).

“Billion” means a thousand million; “trillion” means a thousand billion.

As used in this publication, the term “country” does not in all cases refer to a territorial entity that is a state as understood by international law and practice. As used here, the term also covers some territorial entities that are not states but for which statistical data are maintained on a separate and independent basis.

Foreword

The Pacific island region has considerable potential for development, especially in the areas of tourism, fisheries, forestry, mining, and agriculture. With these resources and the continued substantial economic assistance from donors that is expected, it is certainly feasible to lift these countries’ medium-term economic growth record, improve human development indicators, and reduce poverty. Experience since independence demonstrates that the traditional way of life can be preserved, even while the processes of development create modern institutions and help to meet changing aspirations.

The Pacific island countries face many challenges in developing their economies and raising living standards, including their small size, distance from major markets, and vulnerability to natural disasters. Successfully overcoming these challenges will require the continuation of macroeconomic stability and increased emphasis on the structural reforms to which island governments are committed, including improved public sector efficiency and greater private sector activity. While recognizing that important economic, political, and cultural differences exist between the islands, there are a range of policy recommendations that are widely applicable throughout the region.

The International Monetary Fund has for many years enjoyed regular, open, and fruitful discussions on economic policy with all the member countries in the region. This dialogue is now being intensified through more frequent staff visits. The islands have made only limited use of IMF resources in the past, but financial support can always be considered when needed.

The IMF will also continue to play a key role in providing technical assistance to the region, particularly through the Pacific Financial Technical Assistance Center (PFTAC). This institution is located in Suva, Fiji, and serves 15 Pacific island countries: Cook Islands, Federated States of Micronesia, Fiji, Kiribati, Marshall Islands, Nauru, Niue, Palau, Papua New Guinea, Samoa, Solomon Islands, Tokelau, Tonga, Tuvalu, and Vanuatu. It is funded by the Asian Development Bank, Australia, the IMF, Japan, the Republic of Korea, and New Zealand.

This book provides an assessment of regional issues that are currently being addressed by economic policymakers. The country-specific chapters, which comprise the second half of the book, provide in each case a broad overview of the main factors affecting the countries’ individual economic performance since independence and the main challenges that lie ahead.

David Burton

Director, Asia and Pacific Department

Acknowledgments

This volume is a collective effort, authored by economists of the IMF’s Asia and Pacific Department (APD) who have worked on Pacific Island countries. The project was conducted under the general guidance of Christopher Browne, Assistant Director, APD, who authored several chapters and reviewed the remaining chapters. Steven Dunaway, Deputy Director of APD, provided helpful comments. Fritz R. Pierre-Louis from APD finalized the charts and tables. We are particularly grateful to Linda Griffin Kean of the IMF’s External Relations Department, who edited the manuscript and coordinated production of the book.

The views expressed are those of the authors and do not necessarily reflect those of the IMF, its Executive Board, or its management.

Abbreviations

ADB

Asian Development Bank

AML

anti-money laundering

AML/CFT

anti-money laundering and combating the financing of terrorism

BCBS

Basel Committee on Banking Supervision

CARICOM

Caribbean Community and Common Market

CCQG

Council on the Cost and Quality of Government

CET

common external tariff

CFT

combating the financing of terrorism

Compact I

original Compact of Free Association with the United States, 1987-2003 (Marshall Islands, Micronesia, and Palau)

Compact II

renewed Compact of Free Association with the United States, 2004-23 (Marshall Islands, Micronesia, and Palau)

ECCU

Eastern Caribbean Currency Union

ECTEL

Eastern Caribbean Telecommunications Authority

EEZ

exclusive economic zone

EMU

European Monetary Union

EPA

Economic Partnership Agreement (with the European Union)

EU

European Union

FATF

Financial Action Task Force on Money Laundering

FDI

foreign direct investment

FDIC

Federal Deposit Insurance Corporation (United States)

FORSEC

Pacific Islands Forum Secretariat

FSM

Federated States of Micronesia

GDP

gross domestic product

IDA

International Development Association (World Bank)

IMF

International Monetary Fund

MDGs

Millennium Development Goals

PIC

Pacific island country

PICTA

Pacific Island Countries Trade Agreement

The Plan

Pacific Plan for Strengthening Regional Cooperation and Integration

PNG

Papua New Guinea

PPAC

Pacific Plan Action Committee

RAMSI

Regional Assistance Mission to the Solomon Islands

RERF

Revenue Equalization Reserve Fund (Kiribati)

RMI

Republic of the Marshall Islands

RTFP

Regional Trade Facilitation Program

SI

Solomon Islands

UN

United Nations

VAGST

value-added tax on goods and services

VAT

value-added tax

WTO

World Trade Organization

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