Asian Development Outlook 2011 on Pacific Agriculture

Agriculture in the Pacific according to the Asian Development Outlook 2011

This post picks out quotes from the Asian Development Outlook 2011 on what it says will happen to agriculture and food prices in 2011 as well as some background for the last couple of years.  The report can be found here in full.

PNG

“Agricultural output rose by 3.5% [in 2010]. High global prices for agricultural commodities will likely stimulate their production in 2011. Cocoa output is expected to rebound after it suffered from disease in 2010, and coffee production will rise, weather permitting.”

Fiji

“After contracting in 2009 the economy achieved slight growth in 2010, based largely on a recovery in tourism and some goods exports, though the sugar industry weakened for a fourth consecutive year.  Agriculture suffered from a cyclone in March 2010, then a drought. The sugar industry, which supports about a quarter of the population, has declined in recent years as the European Union phased out preferential prices it paid to certain nations, including Fiji. The European Union was to provide assistance to the country’s sugar industry, but postponed the plan after the coup in 2006. Last year, the government initiated a sugar industry reform program that included funding for new cane planting, but farmers continued to leave the industry and cane production fell by 19%. Breakdowns at sugar mills caused production of raw sugar to slide by 20.8%.  Fiji Sugar Corporation, after accumulating losses of more than F$200 million in 2009–2010, is being taken over by the government, and the firm’s operations are now funded through the national budget.”

Sugar and Cane Production, 2000s

 “Generally, the outlook in the forecast period depends heavily on prospects for the sugar and tourism industries. Reforms in the sugar industry that started in 2010 are assumed to make slow progress, in view of capacity constraints in the government and the need to consult many stakeholders.”

Smaller Pacific Island Countries

“Seven of the 11 small Pacific economies grew in 2010, albeit slightly, and GDP was estimated to be flat in three. GDP fell in one (Tonga), in contrast to 2009 when the global recession contributed to contraction in seven economies…Inflation is projected to increase in all 11 countries this year, primarily owing to higher global food and fuel prices for these import-dependent economies, before price pressures ease for most of them in 2012.”

Marshall Islands

“Supported by grant-financed increases in government spending and expansion in fish processing, the economy grew by an estimated 0.5% in FY2010 (ended 30 September 2010). This represented a turnaround after 2 years of declining GDP. Higher global prices of copra and coconut oil—the country’s major agricultural exports—contributed to some increase in export receipts.”

Federated States of Micronesia

“The reopening of a fish-processing plant in Kosrai and an increase in small-scale agriculture stimulated by rising commodity prices helped the economy, as did some uplift in remittances and tourism receipts. Inflation subsided to about 3.5% in FY2010, owing to lower prices for imported food and energy in the early part of the year.”

Samoa

“Declines in agriculture, tourism receipts, and remittances offset growth in construction, manufacturing, and transport and communications in FY2010 (ended 30 June 2010), leaving GDP flat.”

Solomon Islands

“This economy recovered in 2010, growing by an estimated 4.0% after contracting by 1.2% in 2009. Logging led the upturn. After a poor year in 2009, log export volumes rose by about 30% in 2010, a result of recovering demand in Asia that also helped to lift international log prices. Production of palm oil and cocoa, as well as the size of the fish catch, also increased, although copra production declined.”

 

Tonga

“In the external accounts, increased receipts from exports of sea cucumber more than made up for declines in fish and agricultural products in FY2010, so that total exports grew by 2.2%. Imports fell sharply, by 21.0%, reflecting weak domestic demand. The current account deficit narrowed to $16.6 million from $24.8 in FY2009.”

Vanuatu

“Growth slowed to an estimated 3.0% in 2010 from an average of 5.7% in the previous 7 years. Agricultural production and construction increased, but tourism and retailing were soft.”

“GDP growth this year is forecast to rise to 4.2%, based on an expected increase in tourist arrivals—particularly from Australia— driven by robust economic conditions, a strong Australian dollar, and increased flights from that country. Agriculture is expected to pick up owing to high commodity prices. GDP growth of around 4.0% is expected in 2012, on continued gains in tourism and agriculture. Higher food and fuel prices are forecast to raise inflation to 5.0% in 2011, before it eases to 4.0% in 2012. The current account deficit is expected to widen in 2011 and 2012 to 3.8% and 4.7% of GDP, respectively, as the pickup in domestic demand lifts imports.”

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