REFLECTIONS ON AN EVENTFUL 2008 IN TONGA

Editorial

Matangi Tonga

NUKUALOFA, Tonga (Jan. 2, 2009) – As we face the New Year of 2009, it is time to reassess our perceptions and the reality of our economic and political reform programs. Economically, we were convinced that the reforming of Tonga's economy by adopting a new Customs Duty Tariff and a new taxation system, and becoming a member of the World Trade Organisation (WTO) would open up a door of opportunity for Tongan companies to negotiate deals with multi-national companies and attract a flow of foreign investment to Tonga.

By being a member of the WTO and a party to an international Free Trade Regime enabled us to have access to an international market, in return for, of course, the free access of overseas products and services to our small market.

The reality of our WTO commitment is that our local market can't compete with overseas goods and services, and today local manufacturers and industries are up against big international companies flooding the market with their products. Examples are our local brewery against the influx of overseas beers, and other industries such as local water purification and locally produced eggs.

With regards to foreign investment, excepting for Digicel and the three Commercial Banks, ANZ, Westpac and MBf Bank, most of the multi-million pa'anga investments in tourism facilities in Vava'u and in Tongatapu are by Tongans.

There was a hope for foreign investment in Tonga's power generation but it was not attractive enough for foreign investors and government is having another go at running our power generation facility.

The crunching problem that we are facing is a lack of employment opportunities, but because of our WTO membership, government no longer can subsidise local industries. There is supposed to be a level playing field in industrial trade, disregarding whether it is a bout between a heavy weight and a feather weight.

The position of the government with regards to the status of our economy was clearly stated by the Minister of Finance, Hon. Afu'alo Matoto late last year, when he told local business people, "there is no going back, we just have to find a way forward."

Meanwhile, we are relying more and more on foreign aid and remittances from overseas Tongans and on the seasonal work scheme that has been offered by New Zealand and Australia. Long time aid donors New Zealand, Australia, Japan and China have all increased their aid to Tonga during the past two years.

The way forward to be in line with a western concept of a global economy that we have embraced, is the adoption of a western form of democracy - meaning an elected form of government.

The idea of adopting a new system of government has been generally accepted by the king at the apex of our hierarchical society and right through to the ordinary village folks. But the nuts and bolts of such a system have not been decided on; of how to make a new Tongan system more democratic, transparent and accountable to the electors.

A concern over how change might impact our social structure and our land tenure system has not been addressed or clarified.

For the meantime, with the recession that has sent shock waves throughout the industrial world, and closer to home seeing how the cost of living, including food has gone up, many Tongans today can still give a sigh of relief - thanks to the vision of Tupou I - in the knowledge that we still have our family land where we can grow some food and build a hut.

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