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MANILA, Philippines — The Pacific region is expected to grow by 3.3% in 2024 and 4.0% in 2025, but the need to build resilience continues, according to the latest Pacific Economic Monitor (PEM) released today by the Asian Development Bank (ADB).
The growth was mainly due to the resumption of resource extraction in Papua New Guinea, the largest economy in the subregion. Most tourism-dependent economies saw stable tourist arrivals, and stimulus from public infrastructure projects was also seen as a factor in boosting growth. However, a range of factors, including labor shortages, reduced fiscal space, and climate change and disaster risks, pose downside risks to the outlook.
“This positive growth is good news for the Pacific, but significant downside risks highlight the need to continue building resilience,” said Leah Gutierrez, ADB’s Regional Director for the Pacific. “ADB will continue to work closely with its Pacific developing member countries to help manage these risks and protect development gains from shocks.”
The latest PEM explores various aspects of building resilience in the Pacific. One article discusses ways to build climate and disaster resilience in the Cook Islands, Samoa, and Tonga, while another examines Fiji’s new budget for fiscal year 2025 from the perspective of maintaining economic growth while adhering to debt targets. Other articles related to public financial management explore debt sustainability challenges facing Papua New Guinea, ways to better manage constituency development funds in the Solomon Islands, and strategies for building resilience in the Marshall Islands, the Federated States of Micronesia, and Palau after renewing their Compacts of Free Association with the United States. Other articles explore social protection and high living costs in Kiribati, Niue, and Tuvalu; developing a resilient labor market in Nauru; and the future of air travel in Vanuatu.
Policy briefs in the PEM focus on building resilient infrastructure, enhancing climate resilience and strengthening public financial management in the unique Pacific context. Another policy brief highlights the need to understand the vulnerability and fragility of Pacific Small Island Developing States to develop resilience solutions.
The Pacific Economic Outlook is a semi-annual review of economic development and policy issues in ADB’s 14 developing member countries in the Pacific region. In conjunction with the Asian Development Outlook (ADO) series, ADB provides quarterly reports on economic trends and policy developments in the Pacific region.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, ADB is owned by 68 members—49 from the region.
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