Tonga Poverty and Equity Assessment 2024
Executive Summary
The report "Navigating Turbulent Waves Toward Sustained Poverty Reduction: Tonga Poverty and Equity Assessment 2024" aims to analyze the patterns, trends, and drivers of poverty and inequality in Tonga. It highlights the significant reduction in poverty levels from 2015/16 to 2021, attributing it to various factors including economic growth and social protection programs.
Key Findings
-
Poverty and Inequality Reduction
- Poverty and Inequality Patterns: From 2015/16 to 2021, poverty and inequality levels decreased significantly.
- Impact of Human Capital: Limited human capital contributes to skill mismatches and hinders overall development.
- Social Protection Programs: Current social assistance programs have a minimal impact on poverty reduction due to their limited coverage.
-
Poverty Trends and Drivers
- Consumption Growth: Poorer households, especially those without employment, experienced stronger consumption growth during the period.
- Vulnerability to Natural Hazards: Poorer households are more exposed and vulnerable to natural hazards, indicating a need for better resilience measures.
-
Human Capital and Labor Market
- Labor Force and Employment: The labor force and employment conditions have remained relatively stable over time.
- Supply and Demand Factors: Key factors influencing labor demand and supply include education levels and market dynamics.
-
Poverty and Social Protection
- Coverage of Social Assistance Programs: The current social assistance programs (SAPs) are insufficient to protect the poor effectively.
- Improvements Needed: Enhancing social protection systems to better safeguard the most vulnerable populations.
-
Resilience and Vulnerability
- Natural Disasters: The economic impact of natural disasters is significant, particularly in rural areas.
- Urban vs. Rural: Poverty rates are lowest in urban areas like Tongatapu and highest in rural areas such as 'Eua and Ongo Niua.
Summary of Key Data
- GDP Growth: Tonga's GDP growth was already weaker than other Pacific Island Countries (PICs) before the COVID-19 pandemic.
- Remittances: Remittances received have been rising rapidly, making Tonga the world leader in terms of remittance share relative to GDP.
- Tourism: The tourism sector was growing before the pandemic but faced significant disruptions.
- Population: The population has been slightly decreasing due to declining fertility rates and migration.
- Poverty Rates: Poverty is lowest in urban areas (Tongatapu) and highest in rural areas ('Eua and Ongo Niua).
Overall, the report underscores the need for comprehensive strategies to address persistent poverty and enhance resilience against economic shocks, particularly focusing on improving human capital and expanding effective social protection programs.
