Vulnerability: A Pacific reality
Issues Paper prepared for the Summit of ACP Heads of State and Government
Libreville, Gabon, 6-7 November 1997
When this paper was commissioned, the issue of vulnerability, even-though rather simple in terms of its concept had been well assessed by Professor Briguglio of the Small Islands Institute in Malta and by the Commonwealth Consultative Group report on "Small States in the Global Economy". Most of the information in this paper has therefore been sourced from these two important documents.
The paper should not be considered as an exhaustive and global assessment of the issue of vulnerability. This paper attempts to depict the realities of the Pacific region and their struggle against difficulties inherent in its relative isolation and remoteness. This paper gives an overview of the economic, environmental and social realities of the Pacific Island Countries (PICs) and concludes with the overall promotion of the Barbados Programme of Action as a recognised instrument to counter the issues of vulnerability.
As the concept of vulnerability is vast and cross-cutting, this paper will define vulnerability with regards to the environment, the economy and the society in the Pacific region.
By 1988 a wide array of such disadvantages were recognized, as evidenced by a comprehensive document prepared by UNCTAD in preparation for a meeting of a group of experts on Island Developing Countries, held in Malta in May 1981. The deliberations of the Malta meeting led to a United Nations resolution recognizing that in addition to the general problems faced by developing countries, island developing countries suffer additional handicaps arising from the interplay of such factors as smallness, remoteness, geographical dispersion, vulnerability to natural disasters and a highly limited internal market.
The General Assembly, at its 47th session, resolved to convene a global conference on the sustainable development of small island developing states (A/Res/47/189 of 10 March 1993). The programme of Action of the global conference, held in Barbados in April 1994, contained a section (paragraphs 113 and 114) recommending that a Vulnerability Index be constructed.
When discussing the development issues of some 500 islands, the reference to aggregates, such as the three sub-regions, is an important analytical tool. Referring to sub-regional patterns without care, averages can provide wrong impressions which, once in circulation, are often difficult to correct. This is of particular importance in the Pacific, where two out of three people reside in Papua New Guinea alone, and where some countries have resident populations of less than 10,000 inhabitants.
The Pacific Ocean is the earth’s greatest single geographical entity, extending over one-third of the earth’s surface. The islands that lie within this area vary greatly in their physical geography. The Melanesian countries of Papua New Guinea, the Solomon Islands, Vanuatu, Fiji and New Caledonia comprise large, mountainous and mainly volcanic islands. They are endowed with considerable natural resources: fertile soils, large forests, mineral deposits and rich ocean resources.
Micronesia and Polynesia are characterised by much smaller island countries. Most are small atolls with poor soil, with elevations usually between one and two metres (Kiribati and Tuvalu); there are some islands of volcanic origin with more fertile lands (Western Samoa and Tonga). Natural resources are mostly limited to the ocean; the seas of Micronesia and Polynesia are generally rich in living resources, and reported to have significant prospects for exploitable non-living resources (petroleum, natural gas, minerals).
Just as island societies are interconnected despite the distance, they are untouched by developments outside the region. The smallness of the Pacific should not mean that the world developments have little relevance to the region; neither should the "smallness" mean that economic and geopolitical issues are unimportant. On the contrary, small islands dispersed over large areas of land and ocean create many distinct development problems.
One attitude shared throughout the region is the importance placed on land. With three out of four Pacific Islanders living in a rural environment, land forms an integral part of culture. Through systems of ownership and use vary greatly, land is vested in groups based on common descent, place of residence, and participation in social and economic activities. Land means identity with a family, a clan, a lineage. It is therefore valued for what it symbolises, not just because it meets most subsistence requirements and thus forms the basis of everyday survival for most Pacific Islanders.
(PICS).
Three years before the end of this millenium, Pacific Island Countries face a series of distrubing facts that emphasise the unique development obstacles that affect the peoples of the South Pacific. These are:
A major environmental problem associated with islands is erosion. PICS have a relatively large coastline in relation to their land-mass. Thus a relatively large proportion of land in such islands is exposed to sea-waves and winds, giving rise to a relatively high degree of erosion of land and soil.
As is well known, national account statistics do not normally take into consideration environmental degradation and resource depletion. In other words, GNP statistics may give a picture of growth and development, whereas in reality a country might be undergoing a process of long-term unsustainability and degradation. Environmental problems are likely to be particularly intense in PICS.
Many islands experience natural disasters caused by cyclones (hurricanes or typhoons), earthquakes, landslides and volcanic eruptions. Although natural disasters also occur in non-island countries, the impact of a natural disaster on an island economy is expected to be relatively larger in terms of damage per unit of area and costs per capita, due to the small size of the country.
In some instances, natural disasters threaten the very survival of small islands. Some of the effects of natural disasters on small economies include the devastation of the agricultural sector, the wiping out of entire village settlements, the disruption of a high proportion of communication services and injury or death of a relatively high percentage of inhabitants. Recent examples are the passages of Cyclone Gavin in Fiji which caused damages estimated at more than $US 18 million.
The pressure on the environment arising from the process of economic development in PICS tends to be much higher than in other countries. In many islands, increased demand for residential housing and industrial production has given rise to a fast depletion of agricultural land. Small islands also experience intense use of the coastal zone for tourism and marine related activities. They also tend to generate a relatively large amount of waste. These problems are of course also faced by countries undergoing a process of economic development, but their effect on PICS is likely to be much stronger due to their small size. The process of economic development also brings with it an increased demand for resources, some of which are non-renewable. Some PICS have experienced depletion or near depletion of such natural resources. This happened for example in the case of Fiji (gold), Vanuatu (manganese), Haiti (bauxite) and Nauru (phosphate).
The economic performance of Pacific Island Countries during the past decade has had mixed success. Despite the high levels of foreign aid and high rates of public investment, there has been virtually no growth in average real per capita income during this period and little job creation. Furthermore, the fact that economic growth has not kept up with population growth is a matter for deep concern.
Threats to economic security seldom take overt forms. They are mostly concerned with ever-present dangers for economic independance, economic stability and economic progress arising from weakness and vulnerability and from exposure to a wide variety of relatively strong economic forces.
Furthermore the liberalisation of global trade coupled with the Northern monopoly of the new information technologies has effectively brought back the colonial period to the global South. As a former Secretary to the Ministry of Information and Broadcasting in India said:
The new communications revolution has launched a new era of colonisation. Earlier conquerors relied on armed might to win new colonies and keep them under control. It was a messy affair and morally quite embarrassing. The new technologies give the North all the advantages of captive territories without any of the attendant headaches.
Small size is usually associated with undiversified economic structures and a tendancy to concentrate on industries with unstable external demand -- thus enhancing exposure to external economic shocks. In many cases, high dependance on external source for strategic supplies such as food and energy widen this exposure. Internal shocks also tend to be severe as pervasive economic damage results from time to time from cyclones, volcanic eruptions, farm diseases and from pests.
Small size often implies below average natural resource endowment and low inter-industry linkages, which result in a relatively high import content in relation to GDP. This makes the economy highly dependent on foreign exchange earnings. Furthermore the small size of a domestic market severely limits import substitution possibilities. In many PICS where import substitution policies were adopted, the end result tended to be a protected economic environment, with inferior quality products, higher prices and a parallel market in imported goods. In other cases, tax free economic incentives to attract foreign investment have created an artificial economic growth as most of the profits from these investments are not reinvested in the local economy, but are sent overseas. The poor economic performance of the island countries can be explained, in part, by these features, in particular by deteriorating terms of trade due to the falling commodity prices and (in some countries) severe storm damage caused by tropical cyclones. In addition, economic policies have often involved inward-oriented development strategies. There has been limited success in diversifying the economic base and in encouraging productive private sector investment, and returns on public investments have been low.
Agriculture and fishing are the main activities for the vast majority of the region’s population, and for some countries, they are their only source of exports. Virtually all countries produce and export copra and other coconut products. With markets for these products severely limited, most countries have reduced their outputs considerably in recent years.
As copra has been the major source of export income for many of these countries, these developments have seriously affected the economies of most outer islands and remote rural areas, especially where copra earnings have traditionally been the sole source of household income. Attempts at changing the habits of local growers to other cash crops have been fairly limited.
One of the most reliable and high income cash crops that has been promoted is Piper Methysticum, otherwise known as kava, awa, or yaqona. Even with such a reliable cash crop, the relative transition from copra or other cash crops to this high income cash crop has been rather difficult due to the traditional planting methods. Fortunately, the large numbers of Pacific islanders living overseas have become a lucrative market for traditional crops like taro, tapioca, and kava.
Recurrent Deficit in Human Resources
Despite the progress made in human resource development, the challenges faced by Pacific island countries in trying to improve their economic performance and living standards are formidable. While the majority of Pacific island populations have been provided with rudimentary literacy skills and some access to basic health care, few countries have been able to provide the agriculture and industrial training needed for a sustained economic growth. Critical shortages of professional, technical and managerial staff, coupled with large numbers of workers with low quality general education and limited formal employment opportunities are severe constraints to development.
The heart of the problem is the weak power of the administration of small states and the growth of corruption, fraud, commercial crime, drug trafficking, prostitution and political interference. Undue political and economic influence exercised by foreign business interests can have harmful consequences for security and progress. The threat is prevalent from unscrupulous foreign business firms and adventurers that are attracted to the tourist industry and off-shore financial activities on which small states increasingly rely to secure economic progress. One of the prime example which clearly depicts this threat was the near bankruptcy of the Vanuatu Government as a result of unsound and dubious investments. There is increasing incidence of criminal intent in foreign business ventures in small states and besides the administrative, economic and political problems this causes, it carries serious security implications.
Small size creates problems associated with public administration, the most important of which is probably a small manpower resource base from which to draw experienced and efficient administrators. Very often specialists can only be trained overseas in larger countries, without a guarantee that their services will be needed on their return. For this reason, many specialists originating from PICS emigrate to larger countries where their services are better utilized and where remuneration for their services is better. One outcome of this is that PICS have to rely on larger states, generally the ex-colonizing country, for certain specialized aspects of public administration. A related problem is that many government functions tend to be very expensive per capita when the population is small, due to the fact that certain expenses are not divisible in proportion to the number of users. For example, overseas diplomatic missions of small island states are often undermanned, and many are represented by roving ambassadors.
Another public administration problem in PICS is that people know each other well, and are often related to each other. This tends to work against impartiality and efficiency in the civil service and against a merit-based recruitment and promotions policy.
Furthermore, small states do not have the administrative and security capacity to delineate and monitor effectively their EEZs and to deter foreign intrusion. Many of them have thus not been able to prevent illegal exploitation by foreign deep-sea fishing fleets.
Small Economies and Foreign Exchange
A small domestic market and the need for a relatively large amount of foreign exchange to pay for large import bills, gives rise to a relatively high dependence on exports and therefore on economic conditions in the rest of the world. In many cases, small size restricts the country's ability to diversify its exports, and this renders the country dependent on a very narrow range of goods and services.
PICS have negligible control on the prices of the products they export and import. All developing countries are to an extent price takers, but PICS tend to be price takers to a much higher degree due to the relative very small volume of trade in relation to the world markets in products they import and export.
Small size renders it difficult for PICS to exploit the advantages of economies of scale, mostly due to indivisibilities and limited scope for specialisation. This gives rise to, among other things, high unit costs of production, high costs of infrastructure per capita, high unit costs to train specialised manpower, and a high degree of dependence on imported technologies, since small size inhibits the development of endogenous technology.
Freight Costs
It is to be expected that transport costs associated with the international trade of PICS tend to be relatively higher per unit of export than in other countries. The main reason for this is that islands are separated by sea and are therefore constrained to use air and sea transport for their imports and exports. Land transport is out of the question, and this reduces the options available for the movement of goods and of people.
Apart from this, a small economy tends to require relatively small and fragmented cargoes, leading to high per unit costs. Moreover, the small size of PICS often excluded them from the major sea and air transport routes, which give rise to delays and constrains the ability of these states to exploit the advantages of modern and technologically advanced means of transport.
Apart from high unit costs for transport, insularity and remoteness from the main commercial centres may also give rise to additional problems such as time delays and unreliability in transport services. These create uncertainties in the provision of industrial supplies. These disadvantages are more intense for islands that are dispersed over a wide area. An additional problem is that when transport is not frequent nor regular, enterprises in islands find it difficult to meet sudden changes in demand, unless they keep large stocks. This implies additional cost of production, associated with tied up capital, rent of storage space and the wages of storekeepers.
Some islands are excessively dependent on foreign sources of finance including remittances from emigrants and development assistance from donor countries. This reality is especially present in the Pacific region. However, these inflows of transfers from abroad have permitted many PICS to attain high standards of living and to offset trade deficits.
A characteristic feature of small economies is their relative openness. Limited domestic markets and extensive exposure to the outside world have encouraged this outward economic orientation. Because of the economies of scale and resource considerations, this greater reliance on international trade is characterised by a tendency towards both product and market concentration in the export market - a few products going to a small number of countries.
Another economic feature is the high per capita cost of installing and maintaining essential infrastructure such as harbours and airports. In most cases, the countries have to import technical assistance to facilitate the implementation of projects. This has contributed to a legacy of relatively high official bilateral financial assistance, on a per capita basis.
The threat of economic dependency and insecurity has laid emphasis on the benefits of multilateral cooperation agreements for Small Island States. However, the push for bilateralism in international trading and financial arrangements has now become a major threat to multilateralism.
The need to have predictable concessional resources and assured markets have led many small states to seek and maintain economic cooperation arrangements with major countries. The major powers themselves may have strategic and commercial interests in such arrangements. In today’s world of tight aid budgets and restrictive trade access, in terms of the options available, such multilateral regional arrangements have a significant importance to the development of small states. The South Pacific Regional Trade and Economic Cooperation Arrangement (SPARTECA) and Trade Preferences under the Lomé Convention are examples of such arrangements.
The contentious point about trade preferences is that they create an artificial economic and industrial growth in the Small Island States that depends on the importing market’s demand. It also depends on the ability of the country’s industrial sector to sustain these imports. If and when these imports become a threat to the viability of the importing country’s own industry, it is likely that they will merely eliminate such preferences. The brunt of such a decision will be on those Small Island States which have used these trade preferences and have developed national economies almost entirely around them. In other words, the trade preferences which were initially proposed as economic incentives to industrial growth in Small Island States have now become the raison d’etre of these island industries.
This evaluation of trade preferences echo those made of the South Pacific Regional Trade and Economical Cooperation Agreement on 16 Pacific Island countries. SPARTECA is the Pacific region’s free trade agreement under which Australia and New Zealand offer non-reciprocal free trade access into their markets. The objectives of SPARTECA are:
"to achieve in favour of FORUM Island countries duty free and unrestricted access to the markets of Australia and New Zealand over as wide a range as possible; to accelerate development of FORUM Island countries in particular through the expansion and diversification of their exports to Australia and New Zealand; and to promote and facilitate economic cooperation including commercial, industrial, agricultural , and technical cooperation."
The study of SPARTECA concluded that:
"Despite 12 years of experience of virtually free trade with Australia and New Zealand...most of the Pacific Island countries in general have not only failed to develop their export sectors but sustainable (i.e. non-mineral) trade has actually decreased".
The Sugar Protocol and Fiji
Fiji benefits greatly from the trade preferences under the Lomé Convention. These preferences have been crucial to Fiji in the stability of its economy. The trade arrangements allow guaranteed access into the EU markets at prices higher than the world prices. Fiji is the only country in the Pacific that has made judicious use of its trade preferences to develop its economy, accounting for approximately more than 85% of total trade benefits to the region because of the huge benefits it receives from the sugar protocol. Between 1980 and 1991, the preferential trade benefits that accrued to Fiji amounted to around US$ 712.7 million.
The Fiji sugar industry is a major beneficiary of the Lomé Convention through the Sugar Protocol. Under the Protocol, Fiji has had a quota of 175.000 tonnes of raw sugar per annum. This quota has sustained and consolidated the industry for the last 21 years. The net sugar transfer that Fiji received from the EU in 1995 was $FD 121 million, representing 5% of the GDP. An estimated two thirds of this goes directly to the farmers. For the average cane farmer, this translates into a net operating profit of $FS 4,000. As stated in the Forum Secretariat’s assessment of the sugar industry in Fiji, " Without the preferential access to the EU market the entire surplus of the sugar sector would be lost. The average farmer in Fiji produced 184 tonnes of cane, which gave him a net income of approximately $FD 4,500. Without the Sugar Protocol he would have a net income of $FD 165."
Tuna Preferences
Here again, the 24% margin of trade preference for canned tuna in the EU market has been responsible for the development of canned tuna capacity in the Pacific ACP countries. Pacific Fishing Company Limited (PAFCO) and Solomon Taiyo Limited have developed as a direct result of EU trade preference.
As stated in a Forum Secretariat analysis of the Pacific ACP Tuna Industry:
The tariff preferences have been crucial in terms of providing the Pacific island countries with sources of advantage that allows them to overcome the disadvantage of location, small size and the attendant high cost structure. The de jure economic rents available as a result of this margin of trade preference have been used by relatively large non-ACP-EU investors to develop the industry. In the case of Fiji (and the Solomon Islands, the establishment of canning factories) were based upon the margin of trade preference available....Thus the Lomé Convention was in a key sense the midwife in the creation of the Pacific ACP canning industry.
The commercial viability of the Pacific Fishing Company Limited (PAFCO) has depended to a large extent on the preferential access of its canned tuna into the EU market under the derogated provisions of the Lomé Convention. However, it is simply unable to meet the complex Rules of Origin with regard to the fish that is caught and processed. PAFCO is also presently plagued at the operational level by the inadequate supply of derogation fish and the lack of effective cost control and management. Thus, its return to profitability depends on an adequate supply of derogation fish, proper financial restructuring and productivity improvements.
Social Vulnerability
A recent UNICEF study of the Pacific Island Countries (PICS) draws attention to a few emerging and disturbing statistics:
Demographic changes in small islands are sometimes very pronounced due to out-migration from the country, or in the case of multi-island states, emigration from one island to another caused by the attraction of urban centres in terms of jobs and education. These movements sometimes give rise to brain and skill drains and to social upheavals. This happens also in islands which are economically successful, due to limited opportunities for specialisation in such islands. The substantial achievements apparent in lower mortality regimes are not too unusual, as world-wide efforts have been made to deal with pressing socio-medical and environmental issues that directly, immediately and visibly affect lives.
The record of tackling high fertility is however less impressive. This may point to the difficulty of confronting issues such as family planning where outcomes may not always be regarded as benefits and where the behaviour required to achieve these outcomes may possibly conflict with family / cultural / religious customs and ethics. To this should be added the role of migration, which has served as a safety valve to release pressure of population on land and resources.
The key developments across the region in the 1980s were much improved mortality situation and higher urban than rural population growth. But despite the overall improvements in mortality, the contrast between the relatively high mortality in Kiribati (13/1000) and PNG (12/1000) ad crude death rates as low as 3/1000 in CNMI, is striking. According to the latest available data, life expectancy at birth is the lowest in Kiribati at around 60 years and highest in Guam at 74 years.
As the report states, distinctly different developments between countries emerge in terms of an annual population growth, fertility levels and international migration
To what extent these situations will persist into the future depends on various factors. Firstly, fertility has been declining quite markedly in those countries with the highest resident populations; it could well decline much further, and hence slow down the pace of population growth. In reality, however, current high fertility levels mean that Pacific island populations will continue to grow for many years into the future, as today’s populations are made up of large numbers of young people and relatively few old people.
Secondly, should fertility levels continue to fall, this will offset, at least in the immediate future, by declining infant mortality rates and higher life expectancies. This situation will continue to improve in light of current mortality levels and improving public health conditions.
Should the current trends continue, the Pacific islands’ population will double in 30 years time from its present 6.7 million people to around 13.5 million people, with the fastest growth occurring in towns and cities. In real terms, an annual growth rate of 2.3% means adding a population the size of Vanuatu’s to the region each year. On an national level this means that PNG, for example, would have to absorb and cater for an additional 94,000 people each year, and that the Marshall Islands and the Solomon Islands would double their populations in 17 to 20 years respectively.
At the other extreme, slow population growth rates of 0.5% in Tonga and Western Samoa should not lull their governments into a false sense of security. Annual rates of natural increase of around 2.5% in these countries indicate that their populations will double in about 27 years should international migration outlets suddenly close. It will be even faster in the event of large scale return migration. The biggest impact of such developments would be on the young and old, placing enormous burdens on already stretched governments trying to cope with demands of the present generations.
However, such uncertainties should not prevent Pacific governments from addressing population issues as a matter of utmost urgency. Given the magnitude of population developments just outlined, and their social, economic and political implications, it appears that the joint consideration of population and development will have to become the single most urgent area of public policy reform for Pacific island governments. Experience from other developing countries has shown quite clearly that if left unattended for too long, population processes will develop a momentum of their own and thus ultimately jeopardise most social and economic development efforts.
The complex challenges associated with youth populations across the region include:
Growing demands for social services and employment opportunities are not merely a function of an expanding population today, but are also determined by the urgent need to catch up with unmet demands of the past, as:
These youth populations will maintain the momentum of population growth in the region. This means that, even if every couple limits its child-bearing to just two children, the number of births will be larger than that of deaths for about 40 years until population distributions become more balanced. As today’s Pacific populations are made up of large numbers of young people and relatively few old people, the number of young girls and adolescent women in their reproductive years (15-49 years) by far exceeds that of older women.
Increased youthful populations will put further pressure on already stretched government education, health and community development budgets as new and much-needed development initiatives in these sectors require additional resource allocation.
The Pacific islands are characterised by uneven development and distribution of resources and populations. Capital cities and towns are densely crowded, while other areas, particularly in rural Melanesia, remain sparsely populated. Uneven population distribution increases as employment opportunities and the provision of services expand faster in some places than in others:
Extremes of dense and sparse settlements constrain the rational use of resources and hamper social and economic development, causing congestion in some places and under-utilisation of resources in others, diminishing the quality of life in both. Governments throughout the region face great difficulties in their attempts to provide quality services to their populations. Despite improvements in recent years, most Pacific islanders, particularly those living in remote areas, outer islands, or small settlements remain disadvantaged by limited access to basic public services in addition to limited cash earning opportunities of employment as a result of the distances to local markets and the perennial transport difficulties.
The low levels of overt unemployment and poverty in Pacific island countries are largely due to the resilience of the subsistence sector, which provides a livelihood to people who might otherwise be destitute. Indigenous people throughout most Pacific islands have retained ownership of their land, which cannot be traded commercially. The deep traditional identification of Pacific islanders with their land has prevented the extent of dislocation and poverty that is experienced in some parts of the world. Traditional support systems provided by the extended family are still strong, although weakening in some areas as the result of rapid urban growth.
Pacific island governments often cite uneven development as one of their principal concerns. They recognise the importance of supporting the subsistence sector and enhancing its productivity, as it supports the attempts to support the society in general. Thus it may be stated that the level of rural and outer island development is indicative of government attempts to ensure that the benefits of economic growth are equitably distributed. Such development policies are geared to maintain the social and economic integrity of rural communities and to develop better linkages between the urban and rural economies thus reducing the pressure on resources in urban areas that often result in the degradation of the surrounding environment.
The Global Conference on the Sustainable Development of Small Island Developing States held in Barbados in 1994, was the first follow-up conference of the UNCED Conference of 1992 in Rio de Janeiro. In Rio the small island developing states were recognised as a special case for environment and development under Agenda 21 because of their vulnerability, fragility, small size, geographic dispersion and isolation.
At the Barbados Conference the areas of importance for sustainable development of small island developing countries were discussed. The special value of the Conference is that the fourteen priority areas were elaborated into a Programme of Action, which contains specific actions at the national, the regional and the international level.
Most small island developing states are signatories to the Lomé Convention between the African, Caribbean and Pacific (ACP) States and the European Union. The fourth Lomé Convention was revised in 1995 in Mauritius. The Lomé Convention gives special attention to island countries in this agreement: "For the landlocked and island ACP States, co-operation shall be aimed at devising and encouraging specific operations to deal with development problems caused by their geographical situations" (ACP-EU, 1995:art.8).
In the analysis of similarities inherent in these papers, one notes that many priority areas in the Barbados Programme of Action are already present in the current Lomé Convention. This is especially true for the areas of energy, regional institutions and co-operation, tourism, and science and technology. Areas that are most visibly lacking in the Convention and which are of great importance to small island developing states, are integrated coastal management and an integrated approach on land use.
In general, the Barbados Programme of Action places more stress on the environmental aspects of development than the Lomé Convention. However, consideration of environmental impacts is mentioned in the objectives in most areas of cooperation in the Convention. There are also some areas in the Convention which are not dealt with in the Barbados Programme of Action, such as industrial development and enterprise development. The issue of trade is lacking in the main areas of the Barbados Programme of Action, but it receives attention in the chapter on its implementation.
Whereas the Convention pays special attention to island countries, the articles in which this attention is included, are not much elaborated. If there is a wish by both contracting parties to cater for the specific issues of concern to Small Island States and the specific circumstances of the different regions of the ACP in the future, then a fuller integration of the Barbados Programme of Action into Lomé could form a meaningful contribution.
The first is a direct consequence of its geographical location. It will have to find ways and means of surviving in the global economy, overcoming the isolation and linking up to other markets. In order for this to become reality, the Pacific Islands will have to make a concerted regional effort to react to current global economic trends. However, this effort can only be sustained if there is overall political support from all the Pacific countries. As many of the realities stated above are pertinent to the majority of PICs, it is hence proposed that the Pacific ACP group and other sub-regional groups envisage a united stance in international and regional fora for the survival of the region as a whole.
The second challenge for PICs is to retain a "Pacific Identity". Today, this is threatened by alarming demographic factors, unemployed youth and a lack of rural development in addition to other factors such as western values and the migrational trends of Pacific islanders. It is from within its traditions and cultures that PIC’s can retain this identity. As stated in the Port Vila Declaration, "it is also necessary to take into account the many strengths which our societies and cultures bring to (...) sustainable development challenges. In addressing these issues the active co-operation and participation of all sectors of our communities will be crucial."
That is, after all, the Pacific Way.