Pacific performance and outlook: background paper for Pacific economic survey 2008

Abstract

The overall growth performance in the Pacific improved in 2007 with annual growth increasing to around 3 per cent compared to an average of about 2.2 per cent for the 2002-2005 period (Table 1). Vanuatu, Palau, Solomon Islands and Papua New Guinea grew at above average rates in 2007. Economic growth picked up in Fiji in 2006 but declined in 2007 following the coup in early December 2006. The Cook Islands, Marshall Islands and Samoa also experienced a pick up in growth. For the region as a whole the strong performers in 2007 and 2008 are Papua New Guinea, Timor-Leste, Palau, Solomon Islands and Vanuatu. The strong recovery in Timor-Leste in 2007 reflects the restoration of civil order following the civil unrest in 2006, a sharp increase in government expenditure and the re-establishment of a UN Integrated Mission to support recovery and improved governance.