Opinion: Tonga’s Reliance on External Aid Under Prime Minister Siaosi Sovaleni – A Missed Opportunity for Economic Self-Sufficiency?
During Prime Minister Siaosi Sovaleni’s tenure, Tonga faced some of the most challenging crises in recent memory: the devastating Hunga Tonga–Hunga Ha’apai volcanic eruption, a destructive tsunami, and the ongoing impact of the COVID-19 pandemic. The government’s immediate response centred on securing international aid to stabilize the economy and meet urgent recovery needs, which was critical given the circumstances. However, this approach also brought to light a key issue: Tonga’s heavy reliance on external aid and remittances for survival. The question is, did the Sovaleni administration miss an opportunity to foster a more self-sustaining economy?
Heavy Dependence on Donor Support
Sovaleni’s government actively sought international aid and relief funding, primarily to address the destruction from natural disasters and the pandemic’s economic strain. In March 2023, at the Development Partners Forum, the Prime Minister emphasized the country’s need for additional donor funding and debt restructuring, specifically to support recovery initiatives. These funds from international donors were indeed essential to maintain stability and provide relief for a country that had just been through back-to-back crises.
However, the unsung heroes of this disaster were Tonga’s diaspora communities, who played an indispensable role in relief efforts. In the aftermath of the tsunami, it was the diaspora who shipped over 100 containers of food and non-perishable items, providing essential supplies when the government struggled to meet these immediate needs. This grassroots support filled critical gaps, ensuring that Tongan families could access food and basic necessities. The diaspora also contributed substantial cash donations, yet this contribution often went unrecognized in official reports, which credited international donors with the bulk of Tonga’s recovery. This oversight raises questions about the underappreciation of the diaspora’s role in Tonga’s resilience.
Signs of Economic Strain and the Push for Cash Injection
There are visible signs that Sovaleni’s government is struggling and urgently seeking a cash injection to revitalize the economy. The immediate needs lie with key infrastructures, such as the proposed bridge, ailing domestic airline, and other critical projects. These sectors require significant investment to prevent stagnation. Sovaleni has reportedly been at odds with His Majesty (HM) over the lack of visible economic development. In a 2022 briefing, Sovaleni advised HM on the pressing need for tangible economic development activities, pointing to the lack of sufficient domestic initiatives to drive growth. Yet, despite these efforts, the absence of substantial domestic investment initiatives has limited the government’s ability to address these needs effectively.
Limited Domestic Economic Activity—A Missed Opportunity for Long-Term Growth
Despite the emphasis on recovery, there is scant evidence of the Sovaleni government implementing robust economic policies or incentives aimed at stimulating domestic industries. Tonga’s Strategic Development Framework II and the updated National Infrastructure Investment Plan (NIIP2) were aligned with goals for resilience and sustainability, but much of the focus remained on recovery efforts and securing international aid. The core sectors that could drive self-sustaining economic growth—agriculture, fisheries, and tourism—appear to have received minimal targeted investment or policy attention.
As a result, Tonga’s economy struggled to regain momentum. The country experienced a decline in growth from -2.7% in 2021 to -3.1% in 2022, largely due to global and local economic pressures. While the government can certainly point to natural disasters and global economic challenges as reasons for these setbacks, the lack of strong, diversified domestic economic initiatives is an area for reflection. Sectors that could have bolstered Tonga’s self-sufficiency—such as agricultural modernization, sustainable fisheries, and eco-tourism—were left largely untapped.
Remittances as an Economic Crutch
Remittances continued to be one of Tonga’s primary sources of income, making up more than a third of the nation’s GDP. While remittances provide crucial support to families, they do not contribute to building local industries or generating employment within Tonga. The reliance on remittances keeps Tonga’s economy dependent on its diaspora rather than developing internal sources of growth. This strategy, or lack thereof, limits Tonga’s potential to establish an economy that can withstand global shifts without such heavy dependence.
A Missed Opportunity for Economic Resilience?
In retrospect, Sovaleni’s tenure demonstrated a significant effort to secure aid and stabilize Tonga in the face of adversity, but it fell short in catalysing a resilient and diversified economy. The focus on short-term donor-driven stability left little room for meaningful domestic investment or long-term planning to reduce dependency. By primarily focusing on external assistance, the administration missed an opportunity to prioritize reforms or initiatives that could strengthen Tonga’s economy internally.
As Tonga moves forward, a balanced approach is necessary. While international partnerships and aid will likely always play a role, future administrations would benefit from cultivating industries within Tonga that generate income, provide employment, and reduce dependence on remittances and foreign aid. Only then can Tonga truly build a resilient and self-sufficient economy capable of weathering future storms—both literal and economic.
Conclusion
Prime Minister Siaosi Sovaleni’s administration made notable strides in disaster response and diplomatic engagement. However, the legacy of this tenure will likely be remembered as one of reliance on external aid, with limited progress toward building a self-sufficient economic base. With visible signs of strain on key infrastructures and the urgent need for cash injection to jumpstart critical projects, Sovaleni’s government is at a crossroads. The contributions of the diaspora—through food, supplies, and financial support—highlight the power of local resilience, yet their role went largely unrecognized in official reports. Tonga’s path to resilience requires looking inward, fostering industries that align with the nation’s resources and culture. To build a sustainable future, Tonga must address its economic foundation and reduce its dependence on external forces—a goal that will require bold, forward-looking policies from its leaders.
