SUVA, Fiji, 11 March 2014 --- Today at the University of the South Pacific in Fiji, the World Bank launched a regional report, “Hardship and Vulnerability in the Pacific Island Countries.” Supported by the Government of Australia, the report provides comprehensive new analysis of hardship and vulnerability across the region.
Drawing on evidence from Papua New Guinea, Tonga, Tuvalu, Solomon Islands, Samoa, Kiribati, Fiji and Vanuatu, the report finds that extreme poverty remains rare in the Pacific, but that over 20 percent of people in most countries live in hardship – meaning they are unable to meet all of their basic needs such as food, fuel and medicines.
“Pacific Island Countries are some of the world’s most at risk countries to economic and environmental shocks and people face a number of growing threats, from NCDs to natural disasters,” said Melissa Adelman, World Bank Economist and Lead Author of the report. “Increasingly when these shocks occur, they threaten to push families, and sometimes entire communities, into hardship.”
She said that the report aims to help identify how and where hardship and vulnerability are being experienced so that governments and partners can focus resources where they are needed most, and better protect the most vulnerable households from falling into hardship.
“These are critical issues for development policy in the Pacific region,” said Michael Carnahan, Chief Economist (Development) at the Australian Department of Foreign Affairs and Trade. “People, communities, enterprises and governments are better equipped to pursue productive opportunities and take risks when they are not suffering or vulnerable to hardship.”
Key findings of the report include:
Households headed by less educated people, elderly people, and households with more children, are more likely to live in hardship in all countries covered by the report. Women-headed households are more likely to live in hardship in Kiribati and the Solomon Islands, but are less likely in the other countries.
Levels of inequality in the Pacific are now comparable to those in East Asian countries. In all countries studied, the most well-off people (the top 20%) consume many times more than the least well-off: the bottom 20 percent of income earners accounts for less than 5 percent total consumption in Papua New Guinea and 7 percent in Vanuatu.
People in the Pacific are uniquely vulnerable to economic and natural shocks, as a result of countries’ small size, geographical isolation and high exposure to natural disasters. Dependence on global commodity markets for a large part of basic needs and incomes leaves households vulnerable to large swings in prices for items like food and fuel.
A number of risks are increasing vulnerability for Pacific Islanders. As well as environmental challenges, the report highlights the pressing threat of non-communicable diseases (NCDs). NCDs have already eroded life expectancy in Tonga, and are exceedingly expensive to treat and incur long-term disability costs for many households.
Family and community networks are central to life in Pacific Island Countries and act as critical “safety nets” for people when shocks occur. However, household surveys show that traditional systems do not always reach everyone: those in deepest hardship may be least likely to be part of gift-giving networks. Studies also show that gift-giving may sometimes require greater generosity than many households feel they can truly afford.
The report makes a number of recommendations. It suggests that Pacific governments have an important role to play in complementing traditional systems with social protection schemes, such as old age pensions and disability payments. In addition it recommends greater investment in prevention and management of long-term risks such as NCDs and natural disasters, to reduce future burden on households and governments.
The report also highlights the need for sustained efforts across the region to improve data collection, analysis and communication on hardship, and the importance of standardized methodological frameworks for poverty analysis.
The report was written as a companion piece to the 2014 World Development Report on Risk and Opportunity. It draws on data from Household Income and Expenditure Surveys carried out in the 8 Pacific Island Countries to provide the first comprehensive regional analysis of hardship and vulnerability in a decade.