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Slow growth predicted after years of decline

NUKU΄ALOFA, Tonga (Matangi Tonga, June 24, 2008) - Tonga is waking up after a long slumber, Tonga’s Minister of Finance, Honorable Afu΄alo Matoto said this morning, predicting that a small growth in the economy next year might turn around a long decline in the country’s economic performance.

In launching the Pacific Economic Survey 2008 at the Fa΄onelua Convention Centre, the Minister noted that in the 1980’s Tonga had achieved the second highest growth rate in the world, but "sometime after that we appear to have stopped for a bowl or two of kava..."

He said now Tonga appeared on the low side, "of almost every economic performance table in this Survey."

"This survey is therefore a wake up call for Tonga."

΄Afu΄alo predicted a 3 percent economic growth rate for Tonga next year, which although an improvement is still below that forecast for the region.

"We need economic growth to fund the lifestyle to which we aspire and as other countries get richer we need economic growth just to maintain what we already have. If we stop growing we will not stand still, we will sink."

Afu΄alo said that greater economic growth means greater wealth and improved standards of living.

"A higher standard of living means greater education opportunities, improved care for our elderly and improved health care for all Tongans.

"If that sounds too abstract consider this. It means extra eight babies who currently die every year will live, but only if we can afford the investment to reduce our infant mortality to Fiji’s level.

The Pacific Economic Survey 2008 looks at recent growth performance in the Pacific region, focusing on progress made in connecting the Pacific to the rest of the world, and also within the region, through improved telecommunications, aviation and shipping services.

The survey forecast a 4.5 percent economic growth for the region in 2008. It was presented this morning by AusAID’s Chief Economist Mark McGillbray.

The Pacific Economic Survey 2008 was directed by a Steering Committee of leading regional figures from the Pacific: Margaret Callan, PNG Branch, AusAID; Makurita Baaro, former Cabinet Secretary, Kiribati; Brown Bai, Chairman, Rural Industries Council of PNG; Shadrach Ganega, Department of Finance and Treasury, Solomon Islands; Peter Forau, Pacific Islands Forum Secretariat; Rui Gomes, UNDP, Timor-Leste; Rhoda Moses, Leadership PNG inc; Odo Teni Governor, Reserve Bank of Vanuatu; Afamasaga Toleafoa, former Member of Parliament, Samoa; Mishka Tu’ifua, CEO Westpac Bank of Tonga, and Chair, Tonga Public Service Commission, Ratu Sakiusa Tuisolia, former CEO of Airports Fiji Ltd.

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