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Poverty Reduction in Tonga

Poverty Reduction in TongaThe Polynesian Kingdom of Tonga consists of 170 beautiful South Pacific islands that King Tupou VI and prime minister Siaosi Sovaleni rule as a monarchy. To the pride of its citizens, Tonga is the only Pacific island that was never colonized, even if it was a British protectorate for 65 years. Tonga’s economy struggles today because of heavy reliance on agriculture, lack of jobs and crippling natural disasters. 

Current Poverty and Risks

The U.N.’s first SDG (Sustainable Development Goal) is to erase extreme poverty. In Tonga, one in 10 adults live in extreme poverty, meaning their household income is low, and they lack five or more socially perceived necessities. These include two meals daily, two pairs of shoes and transportation. However, almost a quarter of Tongans live above the extreme poverty threshold but remain poor according to the multidimensional measure — they cannot participate in Tongan society due to insufficient resources. 

Agriculture takes up too many jobs. In 2021, 30% of Tonga’s employment was in agriculture. Still, most of the work only covers residents’ basic needs and does not help grow the economy. Though the country exports fish and produce to New Zealand, the U.S. and Japan, in 2021, these exports only accounted for 3% of the national GDP

Tourism also provides many jobs. In 2020, Tonga made $47 million in tourism revenue which accounted for 9.9% of a $484 million GDP. However, many of these jobs ended due to COVID-19 and natural disasters. Since non-agricultural or tourism jobs are hard to find, Tongans lack job opportunities. 

Jobs are easier to find elsewhere, so family members (especially husbands) commonly leave the island to be able to provide for their families. In 2021, this migration (e.g., remittance) accounted for 46% of Tonga’s GDP, an astronomical number. Since educated migrants come predominantly from wealthier families, there is a chance that remittance increases income inequality and causes GDP stagnation in Tonga.

Tonga is the third most at-risk country for natural disasters after Vanuatu and the Solomon Islands, two nearby disaster-prone Pacific island clusters. In the past three years, Tonga suffered over $200 million in damages from Cyclone Herald and the Hunga Ha’apai eruption. 

Permanent Aid for Poverty and Quality of Life

In 2018, the U.N. created a Pacific Strategy Plan to reach the 17 SDGs laid out at the New York Summit, the first of which aims to fix extreme poverty in the Pacific Islands. The U.N. Pacific Strategy Fund has about $17.7 million in the budget, $16 million of which came from New Zealand. The Plan’s goals are poverty reduction in Tonga and building greater resilience to extreme natural events.

In support of these efforts, the U.N. has provided equipment worth $55,000 to Tonga’s National Emergency Management Office (NEMO). This equipment will enhance the ability to alert citizens about natural disasters and promptly direct aid during crises. Over the last 12 years, the U.N. has introduced 16 permanent agencies to Tonga, including The International Labor Association, Population Fund, International Organization for Migration, U.N. Development Program and Capital Development Fund.

The CDF draws particular attention due to its role as a local transformative finance mechanism. It supports small businesses and offers private loans to projects that foster sustainable economic growth. This approach leads to a long-lasting increase in individual wealth by establishing a consistent income source, as opposed to providing mere temporary relief.

The UNDP currently works to provide HIV vaccines, rapid test kits, contraception and text message preventative information to women in Tonga. There is heavy misinformation about HIV. More than half of the population would not let HIV-positive children go to school, even though the disease is not transferable just by touch or sharing drinks.

Aid for Government Stability and Security

In Tonga, foreign aid funds most government services. Around 49% of the GDP is central government debt. In 2020, the IMF labeled the debt distress of Tonga as high. For comparison, Moldova was ranked low in risk despite 34.7% of its GDP coming from government debt. 

Using this same U.N. Pacific Strategy Fund, The U.N. liaises with the 14 governments in the Pacific and with regional bodies to promote organic, container and home farming to bolster food security, assist policy development for the economic development of outer islands, increase disaster preparedness and support decent work strategies. The organization sits in on government decisions and helps oversee the $17.7 million Pacific Strategy Plan. 

Though Tonga is at constant risk of natural disasters and has a mainly agricultural economy, consistent foreign aid promises to bring long-term growth and economic stability. Overall, there is much hope for poverty reduction in Tonga.

– Claire Duvillier
Photo: Flickr