SAMOA ECONOMY PICKS UP

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APIA, Samoa (October 2, 2000 - Samoa Observer/PINA Nius Online)---The Central Bank’s latest economic indicators show that Samoa’s economy picked up strongly in July, after a mixed performance in the previous month. Total domestic demand strengthened, pushing up the total value of imports strongly.

Exports continued to grow while tourism earnings rose significantly, mainly as a spillover effect of the crises in Fiji and the Solomon Islands.

Furthermore, the volume of agricultural produce at the Fugalei Market increased, and commercial bank credit rose further.

The balance of payments recorded an overall surplus in July 2000, and the inflation rate on an annual basis rose to 0.6 percent from negative 0.1 percent in June.

Exports jumped $2.1 million due mainly to increased earnings from fish and the resumption in copra exports (after being absent in the previous two months). On the other hand, imports increased $5.8 million, widening the merchandise trade deficit by $3.7 million.

(NOTE: All sums are in Samoa currency. On October 3, 2000: Tala: 3.4013 = US$ 1.00.)

Tourist arrivals jumped 34 percent in July, following a 15 percent increase in June, and earnings expanded $4.1 million to $15.8 million from $11.6 million in June.

Private remittances is yet to be finalized but was estimated to have declined by 1 percent to $10.9 million.

The balance of payments recorded a $1.5 million surplus in July following $2.3 million deficit in the previous month.

As a result, net foreign assets edged up 1 percent to $180.0 million, a level sufficient to cover 6.8 months of imports compared to a 6.6 months cover in July 1999.

The overall availability of the selected agricultural produce at the Fugalei Market rose 35 percent and the overall average price level fell 4 percent.

The weighted average lending rate of the commercial banks edged up to 12.4 percent while the average deposit rate slipped to 4.4 percent from 4.6 percent. As a result the interest rate spread increased to 8.0 percent from 7.8 percent in June.

Following an increase of 2.2 percent in June, the Consumer Price Index (CPI) rose 1.1 percent in July 2000. On an annual average basis, the rate of inflation went up to 0.6 percent from negative 0.1 percent in the previous month.

On exchange rates, the U.S. dollar was generally bullish in July, although further evidence pointed to the U.S. economy slowing down. As a result, the Tala depreciated against the U.S. dollar, but was up against all of its trading partners’ (Australia, New Zealand, Japan, Europe and Fiji) currencies during the month.

Pacific Islands News Association (PINA) Website: http://www.pinanius.org 

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