Economic Resilience for the Pacific – Forum Economic Ministers’ Meeting 2018

The "arch" in Palau.

FEMM 2018

Innovative ways to build the resilience of Pacific island countries through sustainable financing flows were examined by the Pacific Islands Forum Economic and Finance Ministers during their annual meeting, which took place in Palau at the end of April (2018).

Pacific Resilience Facility

One of the key decisions the Ministers made was to endorse the proposal for a Pacific Resilience Facility.

The Facility will be a regionally owned fund that can support Forum members by providing cost-efficient and contextualized financing options for resilient development. It will also work to encourage capacity development in the important area of climate and disaster risk budgeting and financing.

One of the best examples of Pacific regionalism is the collective ownership of the University of the South Pacific. In the same way, the Pacific Resilience Facility will promote the strength of our Blue Pacific identity and unity through regional ownership – by pooling economic and political capital to transform the region’s sustainable development paradigm.

To make this work, will require strong and enduring partnerships from our development partners. Current funding to the region from bilateral arrangements between Forum members and their donors and development partners will be unaffected, as the Facility is about new and additional sources of finance within and to the region, and complementary to existing initiatives.

The proposal is a proactive approach, intending its investments to be focused on risk-proofing new development initiatives and retrofitting existing assets before extreme events affect our people, communities and countries. Such preparedness would mitigate the economic costs and impacts of climate and disaster risks through the Forum Leaders’ Framework for Resilient Development in the Pacific (FRDP).

A Mandate for Ownership  

As signatories to global instruments such as the Paris Agreement on Climate Change and the Sendai Framework for Disaster Risk Reduction, which provide the mandate and guidance for work relating to resilience, there is scope and opportunities for Forum members to explore the potential of public and private investment in climate change and disaster risk prevention and reduction, through structural and non-structural measures. These are essential to enhance the economic, social, health and cultural resilience of persons, communities, countries and their assets, as well as the environment.

In September 2016, Pacific Islands Forum Leaders endorsed the Framework for Resilient Development in the Pacific, the FRDP, which seeks to integrate climate change and disaster risk management into development, including low carbon development. The FRDP is a world first in that it integrates all three elements in our efforts to build resilient communities and countries; its effective implementation will however be the real test.

In September 2017, Forum Leaders supported a two-year trial of the Pacific Resilience Partnership Taskforce, established to ensure the effective implementation of the FRDP. The composition of the Taskforce is innovative and different, comprising five positions for countries and territories, five positions for civil society and the private sector and five positions for regional organisations and development partners.

The theme of the 21st Forum Economic Ministers Meeting in Palau this year (2018) was Building Economic Resilience of the Pacific Islands Countries through Sustainable Financing Flows. The Pacific Islands Forum Secretariat provides core papers and advisories related to issues for Economic Ministers consideration during these meetings; papers prepared by development partners when requested complement these.

One of the emerging issues discussed is the need for financial mechanisms and ease of access to finance, which can deal with and are needed to reduce the economic costs associated with the impacts of climate change and disaster events from natural hazard risks.

The Smaller Islands States (SIS) Leaders endorsed the Pacific Islands Climate Change Insurance Facility (PICCIF) during their meeting in September 2017; PICCIF hopes to address the need for appropriate insurance that is accessible to individuals, communities and governments during recovery phase, post-disaster. A PICCIF Taskforce will continue developing the concept for ministerial consideration in 2019.

Co-investment in the region through the Pacific Investment Forum (comprising sovereign wealth funds, social security, pension funds and provident funds) was another initiative considered by Economic Ministers. Ministers supported the establishment of a working group and consider developing a Pacific Infrastructure Investment Framework.

The Pacific is indeed beginning to strengthen ownership of its sustainable development agenda, affirmed through the Forum Leaders’ endorsement of the Blue Pacific narrative, which focuses attention on our geography, our resources, and our identity as people of great ocean states, who believe in the power of the collective, of acting as one unified bloc.

Development Partners Roundtable

Forum Leaders had called for a Development Partners Roundtable with Forum Economic Ministers at their meeting in Samoa last year (2017), to discuss the alignment of resources with the Forum priorities and to determine opportunities for strengthened engagement with development partners particularly in areas of building resilience to climate change and disasters at national and regional levels, given the transboundary effects that climate change and natural hazard risk events can have on more than one country at-a-time, such as Tropical Cyclone Gita which affected Samoa, Tonga and Fiji.

Economic Ministers highlighted a number of key integrated national and regional issues including the significant gaps in financing resilience in Forum countries, the need for capacity-building specific to maximizing government revenues (such as from upper air space management and fisheries) and/or the use of central bank systems as the focal point for release of funds.

Economic Ministers encouraged development partners to embrace a renewed way of working together with Forum Members, including increased, robust, and meaningful dialogue on the key priorities of the Blue Pacific, and to identify potential collaboration and cooperation to take forward Forum Leaders regionalism priorities.

The development partners noted the role of private sector in supporting regional economies and reaffirmed their support for private sector development in the region, including support towards building capacity for a pipeline of economically investable programmes in the region.

Joint Private Sector and Civil Society Dialogue

As a regular practice, Economic Ministers dialogued with representatives of the private sector and civil society.  The endorsement of the preliminary findings of the CSO partnered research on the ‘contribution of sports to the SDGs roadmap and returns of investment for sports in Pacific island countries’ by Forum Economic Ministers signified the importance of evidence and relevant data to inform policy and decision making. The research led by USP in collaboration with ONOC and the governments of Fiji and Samoa drew on case studies in Fiji and Samoa.

Forum Economic Ministers’ further welcomed the expansion of regional efforts for data collection and statistical analyses to include physical education and sport for evidence based policy making; and finally Economic Ministers’ endorsed the establishment of a joint Pacific Sport and Physical Activity Action Plan, and a regional coordination mechanism to assist in its implementation.

Economic ministers discussed several issues raised by representatives of the private sector, including support for disaster risk insurance for MSMEs and Households.

Ministers recommended the establishment of a single regional public tender portal for the advertisement of all Government tenders across the region. Ministers tasked the Pacific Islands Private Sector Organisation (PIPSO) to facilitate the identification and prioritisation of business environment issues, to facilitate intra-regional business mobility.

Economic ministers shared the private sector’s vision for a region that relies completely on self-generated renewable energy, recognizing private sector role in renewable energy investments.

Conclusion

FEMM 2018 has been affirming for Pacific peoples and their Leaders’ – the ownership of their development pathways and determining the partnerships they want and need, as genuine and enduring; it has underlined as well the importance of negotiating our socio-economic development issues and aspirations as the Blue Pacific – inextricably connected by an ocean of environmental integrity and peace.

The inaugural donors’ roundtable featured frank and constructive exchanges. More importantly for your Pacific Islands Forum Secretariat, there were lessons learnt as well which we now take forward, with intentions as always, to better Forum processes.