May 10, 2021 Last Updated 2:42 AM, May 10, 2021

Saving for a rainy day

  • May 11, 2021
  • Published in April

It is well understood that the Pacific Islands is one of the least insured regions in the world, with some estimates putting the penetration rate at just 3.6%.

These figures are particularly sobering given our collective vulnerability to climate change impacts. The cost of damage from cyclones to governments can be debilitating, particularly if they come on top of another pressure, such as the coronavirus pandemic. Cyclone Winston in 2016 cost Fiji an estimated US$470 million. Cyclone Pam a year earlier cost Vanuatu in the region of US$450 million. Tonga, Vanuatu and Fiji suffered significant financial tolls as a result of Cyclone Harold last year.

However, there has been some incremental progress in the climate change financing space in recent times.

Last December, the Governor of the Reserve Bank of Fiji, Ariff Ali, launched the Pacific Insurance and Climate Adaptation Programme.  The initiative is designed to provide “agile and immediate post-disaster financing through market led disaster risk financing instruments,” he said.  The development, piloting and scaling of market-based parametric insurance solutions will be part of the Programme’s work.

It is a project of the UN Capital Development Fund, United Nations University, and United Nations Development Program, and will be focused on women, youth and medium and small enterprises, who are disproportionately affected by natural disasters, as well as vulnerable sectors such as agriculture, fisheries, retail and tourism.

Reports produced by the Program looked at the situation in several island nations, finding that in Tonga, “most people and businesses have no insurance protection, coverage against natural hazards is difficult to obtain and expensive, and the national regulatory framework is inadequate.”

The Programme reports that non-life insurance penetration in Tonga was only 0.9%, well below the average for the Pacific region. Only 13% of adults report having any form of insurance (mostly life and health cover), while 22% report that they are unfamiliar with what insurance is, according to the National Reserve Bank of Tonga.

Similarly in Vanuatu after Tropical Cyclone Pam in 2015, “many business owners who had not procured cyclone insurance folded in the aftermath of the storm, unable to reinvest sufficient savings in their businesses or to tap sources of credit” according to the World Trade Organisation.

Back in 2013, the Pacific Catastrophe Risk Insurance Company (PCRIC) launched a pilot parametric insurance product to provide short term liquidity to governments in the immediate aftermath of disasters caused by cyclones, earthquakes and tsunamis. Last year, under this arrangement, Tonga received US$4.5 million from PCRIC following Tropical Cyclone Harold.

PCRIC is a captive insurance company, allowing members to efficiently transfer excess risk to international markets. In a recent webinar, PCRIC Chief Executive Officer Aholotu Palu described PCRIC as a regional risk pool, “a sovereign instrument facility, aiming to serve the immediate financial needs of the participating countries” after a disaster.

“The reality is that insurance does not solve all the disaster risk management finance needs and really is only sensible financially for low frequency, high impact events,” he said. “Disaster risk finance requires a layered and coordinated approach starting with a country’s contingency savings, the use of concessional loan facilities [such as those made available through international financial institutions] and also national disaster insurance.”

John Plevin, a Financial Sector Specialist working with the Crisis and Disaster Risk Finance global team at the World Bank said: “With the right partnerships you can develop insurance markets that allow households, that allow businesses, to become resilient financially to natural disasters.” He said while support and facilities are in place, Pacific Island governments need to articulate what they need. “Is it coverage for new risks from insurance, new products entirely, or is it just greater technical support and information,” he asked.

Daniel Lund, Special Advisor on Climate Change with the Ministry of Economy in Fiji said while Pacific countries have been setting up forms of national reserve funds to respond to disasters, “these reserve funds have had different challenges. In some cases, funds are set up, but they’re not necessarily topped up consistently, meaning that there’s not necessarily enough liquidity for national reserve funds to always be a legitimate way to respond to events.”

He stresses the need for disaster and climate risk finance to deliver social benefits and safety nets for the Pacific’s most vulnerable through, for example, micro-insurance, while “really capitalising on the agency of people to deliver and support themselves when disasters strike” by giving them a measure of control such as cash transfers.

Lund suggests a mix of micro-insurance and sovereign government-level insurance is the most strategic approach for Pacific nations. But he says the region should also be looking at questions such as what are the barriers to insurance, why can’t the Pacific access the right types of reinsurance, can we start looking at larger insurance pools across similar communities, and is it possible to start highlighting specific demographics that should have subsidised insurance?

In Samoa, Lilomaiava Samuel Ieremia the Assistant CEO Economic Policy and Planning at the Ministry of Finance, told the webinar participants that a Disaster Risk Financing Strategy is being developed which draws on the lessons of the measles epidemic and COVID-19 pandemic, such as the ability to relax procurement processes in times of great need. Lilomaiava says further work is needed to determine relevant insurance products with insurance companies nationally or regionally.

At a regional level, the Pacific Islands Private Sector Organisation (PIPSO) told the Forum Economic Ministers that insurance for asset protection and business interruption to the private sector in response to the climate crisis can be expensive and inaccessible. “As climatic event severity increases as forecast, we will face significant issues in the insurance sector, which may require Government intervention to resolve,” PIFON’s submission to the Ministers states.

Just before the pandemic and writing for the Center for Global Development, Vijaya Ramachandran and Junaid Sadiq Masood asked, “Are the Pacific Islands Insurable?” They raised the need for transparency about the cost of insurance contracts and related exposure to disasters, anticipate that donors would need to subsidise premium payments in the same way they currently subsidise payouts post disaster, and suggest consideration be given to “linking premiums to the degree of resilience preparedness.”

Finally, they believe an overarching body, such as the Pacific Islands Forum, should “keep track of overall levels of indebtedness and encourage all actors to minimize duplication and administrative costs.”

“There may be political economy considerations for both PICs and donors to go the private insurance route (rather than the direct payout route) but these need to be explicit and carefully costed. This is especially the case if public funds are being directed to private companies and/or used to subsidise private insurers or their clients,” they write.

Managing the level of indebtedness, when COVID-19 has exacerbated concerns over the debt burden, remains one of the biggest issues in planning for climate finance, and insurance responses for our governments, and the longer the coronavirus crisis continues, the more intractable those challenges will become.

2021: The diagnosis

  • May 11, 2021
  • Published in January

After an incredibly challenging 2020, what will this year bring? We take a look at the economic and political prognosis and a few key sectors.

Vaccinating for recovery

Timely vaccination campaigns will be key to the recovery of Pacific island economies. The Pacific Community says a handful of Pacific Islands have still recorded no cases of COVID-19 at all (at the time of going to print)—Cook Islands, Kiribati, American Samoa, Niue, Nauru, Tuvalu, Tonga, Tokelau and Palau.  Others such as the Federated States of Micronesia,  have only recorded cases at the border from returning citizens, while most other island nations have recorded no cases of community transmission for months. Those with more open borders—Guam, French Polynesia and Papua New Guinea—have ongoing community transmission.

The economic outlook

As a region, Pacific Island GDP growth was forecast to shrink to 0.5% in 2020, the lowest rate since 1967 according to the World Bank. While most are predicted to grow by small margins in 2021, the World Bank has outlined a number of risks to these projections. “The pandemic could last longer than expected, the long term damage from last year’s recessions could be deeper than anticipated, balance sheet stress could intensify, or the contraction in global trade could be sharper or longer lasting than envisioned. More countries in the region could experience difficulties with procurement and distribution of the vaccine than currently anticipated,” it writes in its Global Economic Prospects report for this year.

Other sectors

The continued reliance on tourism in many Pacific Island countries and uncertainty over the opening of borders and appetite for travel is one of key risks to economic recovery (see page 16).

For the island region’s largest economy, Papua New Guinea,  growth will depend on a strong resources sector, including new investments. There’s some optimism around the construction boom being driven by additional investment into the resource sector and its potential to generate jobs.

“The implementation of new resource projects (Papua Liquified Natural Gas (LNG) and Wafi-Golpu) combined with professional, administrative, and support services needed alongside these projects, could generate formal jobs. There are downside risks, however, such as ongoing disputes over the Porgera mine which could weaken investor confidence,” the World Bank has written.

Work in 2021

In its December 2020  report on COVID-19’s macroeconomic impacts and job prospects, the World Bank said that redeploying workers from hard-hit sectors like tourism to alternative occupations that draw on similar skillsets should be prioritised, and could be supported through re-training.

Globally there has been much hope placed in the digitalisation of work but how does this translate to the Pacific Islands? “Low numbers of ICT job vacancies indicate potential obstacles to the digitalisation of work seen in other regions. Mismatches between demand and supply of skilled labour, which have been exacerbated by the impacts of COVID-19 on labour demand, point to the continued importance of investment in skills development,” the World Bank states.

Political outlook

For Marshall Islands, the Federated States of Micronesia and Palau, critical negotiations over the Compacts of Free Associations with the United States will continue this year. Under each compact, the island nations receive development assistance and visa-free access for its citizens to the United States, and the US in return has a strategic monopoly on the Micronesian states. The compacts also allow the US to test missiles at Kwajalein atoll in Marshall Islands. Palau guarantees the United States the use of certain defence sites in the future under its compact agreement.

Telecommunications tussles

The geopolitical tussle for influence continues to play out in the region’s telecommunications sector.

Digicel has indicated it may sell its Pacific operations in Fiji, Samoa, Vanuatu, Nauru and Tonga after a difficult 2020, and says it has been approached by a number of buyers. The company was carrying approximate US$6.7 billion in debt at the end of last year.  Digicel won’t confirm if those buyers include Chinese telcos, but it is  a prospect that has created concerns in Washington and Canberra. This follows nervousness around reports that Huawei Marine has bid for the Kiribati Connectivity Project, a submarine Internet cable that would connect Kiribati, the Federated States of Micronesia and Nauru to the HANTRU-1 undersea cable which lands in Guam, home to important US military assets.

Climate negotiations

Many Pacific leaders spent 2020 working to push messages on climate change, even as the world’s attention was swallowed by the pandemic, Brexit and America’s political difficulties.

The damage wrought by Tropical Cyclone Harold in Vanuatu and TC Yasa in Fiji last year highlight the continued urgency of this message.

“This is not normal. This is a climate emergency,” Fiji Prime Minister Voreqe Bainimarama said in the wake of TC Yasa.

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The Pacific Islands Forum will hold a two hour virtual summit tonight, dubbed “Kainaki II to COP 26 - a High-Level Roundtable on Urgent Climate Change Action.”

This week’s online summit comes on the eve of the 5th anniversary of the adoption of the Paris Agreement on Climate Change, and the day before a global Climate Ambition Summit 2020, initiated by the United Nations, United Kingdom, and France. With no face to face Forum leaders meeting in 2020, island Presidents and Prime Ministers want to build momentum around the “Kainaki II Declaration for Urgent Climate Change Action Now”, adopted at the 2019 Forum in Tuvalu.

Because of the coronavirus pandemic, this year’s global climate negotiations - the annual UNFCCC Conference of the Parties - have been postponed until November 2021. To maintain momentum on climate action, this weekend’s online summits seek to use the anniversary of the signing of the Paris Agreement for countries to make stronger commitments on reducing greenhouse gas emissions.

Despite the desperate need to keep global temperature increases below 1.5 degrees Celsius, existing commitments under the Paris Agreement put the world on a pathway to nearly 3 degrees. Kainaki says “without urgent action, we will exceed 1.5°C by as early as 2030.”

Last year’s Kainaki II Declaration urged updated pledges on emissions reductions, known as Nationally Determined Contributions (NDCs), calling on “all Parties to the Paris Agreement to formulate and communicate mid-century long-term low greenhouse gas emissions development strategies by 2020.”

Earlier this week, in her keynote speech to the Australasian Emissions Reduction Summit, Forum Secretary General Dame Meg Taylor said: “Governments cannot keep saying, ‘we’re going to do it’, we’re going to do it, we’re going to do it’. We’ve reached a point now where we’ve got 1.2 degrees and we can’t afford to go beyond 1.5.”

Taylor stressed: “Pacific Island Forum leaders have consistently reaffirmed climate change as an existential threat to the region. It is the single greatest threat to the livelihood and the wellbeing of the peoples of the Pacific. The science is clear; it is imperative that we limit temperature rise to 1.5 degrees Celsius above pre-industrial levels to ensure our children inherit a safe and healthy planet.”

Calling for urgent action from the Morrison government in Australia – the Forum’s largest member – she noted: “The commitment of Australian state governments to net zero carbon by 2050 is a win for humanity and we look forward to that same ambition at the federal level.”

The notice issued by the Forum Secretariat for tomorrow’s Forum climate summit also highlights that 2020 is “the year by which developed country Parties to the Agreement are expected to meet their commitment to jointly mobilise US $100 billion per year in climate finance from a variety of sources.”

It’s a reminder to the Morrison government that it needs to contribute its fair share of the global commitment of climate funding to developing nations, after Australia joined the Trump Administration in the United States and refused new funding to the Green Climate Fund. With incoming President Joe Biden pledging to re-join the Paris Agreement, there is increasing focus on the need for greater climate ambition even as countries recover from the economic damage of the global COVID-19 pandemic.

Other Pacific leaders – past and present – are calling for greater climate ambition from Australia and New Zealand as the largest Forum members. On 1 December, former President of Kiribati Anote Tong published an opinion piece in the Sydney Morning Herald, stating that “you can’t solve the climate crisis without addressing the growing supply of fossil fuels.”

He criticised Australia’s latest policy shift towards opening up new gas exploration, noting: “It was most regrettable that the recent Australian federal budget has again chosen to support the fossil fuel industry through a ‘gas-led’ recovery rather than heed the warnings by science and of nature of the clear and present danger facing our people from the multifaceted impacts of climate change.”

Tong stressed: “In 2015, I wrote to every world leader ahead of the Paris Agreement calling for a moratorium on new coal mines. The same moratorium should apply to gas fields.”

Australia has the fourth largest reserves of coal in the world and is the world’s number one exporter of metallurgical coal, used for steelmaking (in 2019-2020, 177 million tonnes of metallurgical coal worth A$35.5 billion was exported). Australia is also the second largest exporter of thermal coal, used for electricity generation, which is ‘dirtier’ and generates more greenhouse gasses when burnt. In 2019-2020, a further 213 million tonnes of thermal coal were exported, generating A$20.9 billion.

However some energy corporations are increasingly concerned that these resources may become stranded assets, losing their value as other countries shift from fossil fuels to renewables. Revenues dropped in late 2020, as prices were hit by the slowdown of the global economy during the pandemic. Despite China’s ongoing use of coal, there are significant shifts in electricity generation towards renewables, and Australian exports are hit by political as well as market changes (by late November, more than 70 coal ships were anchored off Chinese ports, as Beijing pushed back against Australian support for US policy in the Asia-Pacific region).

Companies interested in conducting seabed minerals exploration work in Cook Islands have until December to put in their Expressions of Interest.

This was announced by Prime Minister Mark Brown in an elaborate ceremony last week which officially launched the exploration licensing phase of seabed minerals exploration in the Cook Islands.

“I, the Minister for Seabed Minerals, officially declare blocks of Cook Islands’ Exclusive Economic Zone available for exploration,” Brown said. “I now invite applications from interested parties to apply for exploration licenses in our waters.  The licensing process will be administered by the Seabed Minerals Authority.  The closing date for application is the 11 of December 2020.”

“My word of advice to interested applicants: put your best foot forward.  This is a long term partnership so we the government want to ensure that whoever we allow to operate in our waters will put forward the best exploration work programme and would leave the best outcomes for our country and our people,” Brown added. 

If mining does eventuate, Cook Islands would be the second country in the Pacific to venture into seabed mining, following Papua New Guinea. PNG was the first nation globally to allow seabed mining in its waters when it granted Canadian company Nautilus Minerals a mining license in 1997.

Nautilus has since become bankrupt, abandoning a project that had cost the PNG Government over US$100million in failed investment in the company.

Although the sources of minerals in the two countries are very different – PNG involved the extraction of Seafloor Massive Sulphides(SMS) from hydrothermal vents while in the Cook Islands, any mining activity will focus on extraction from manganese nodules – seabed mining in general is being vigorously opposed in the Pacific by environmentalists, individuals, NGOs and church groups. Other countries such as Fiji have put in place a moratorium on seabed mining until more scientific information becomes available.

But Cook Islands is known to be sitting on a potentially lucrative minerals lode in its manganese nodules, which its Government now wants to tap into as it tries to lessen its economy's heavy reliance on tourism, currently in cold storage due to COVID-19.

The nodules were first discovered there by Russian scientists 50 years ago and since then, a number of scientific expeditions have been carried out in Cook Island waters, firming up a scientific data base on the nature, size and value of its undersea fortunes. 

One early study in 2001 by Japanese scientists in collaboration with SOPAC had estimated the value of minerals in the nodules to be in the trillions of dollars and enough to supply global demand “for the next 500 years”.    

Another study a decade later by Imperial College marine geochemist David Cronan, estimated that the Cook Islands’ roughly two million square kilometres of EEZ contained 10 billion tonnes of manganese nodules, rich in manganese, nickel, copper, cobalt and rare earth minerals and worth tens of billions of dollars as these metals are used in the manufacture of communication technologies (batteries) and in smart and green technologies. 

Commercial mining however was dependent upon the availability of suitable technology, which hadn’t been possible until very recently.    

For Cook Islands, the decision to finally allow exploration to formally begin came after years of groundwork in the creation of relevant laws and governance mechanisms that try to balance environmental concerns with the necessity to convert the potentials of the nodules into economic opportunities.

“To be clear, this is not a process that happened overnight.  It has taken many years and the efforts and hard work of many people, together with exhaustive consultation with all stakeholders, including our traditional leaders, village communities and most importantly our Pa Enua (outer islands) to conclude the preparatory work so that we can be ready to move into this next phase,” said Prime Minister Brown. 

“The sector has the potential for setting up a transformational future for the Cook Islands, one that will secure the prosperity of current and future generations of Cook Islanders.  When extracted in an environmentally responsible manner, the metals found in the nodules, such as nickel, copper, manganese and cobalt have the potential to help meet our SDGs.  To achieve that, we are building a seabed minerals sector based on best principles and practices, supported by a robust legal framework to benefit the Cook Islands and our people in harmony with our high environmental, social and cultural values.”

“With the resurgence of global demand for strategic metals such as cobalt, the Cook Islands has received interests from potential explorers wishing to undertake exploration activities in our waters.   We as a government wanted to make sure that we have our legal framework and our operational systems and processes in place before we open up our waters for exploration,” Brown said.

Much is also riding on the wealth from the nodules to help the country mitigate the impacts of climate change.

“There is a major shift globally towards a society based on renewable energy and technology.  In order to achieve a low carbon economy, the World Bank estimates that more than three billion tonnes of minerals and metals will be needed by the year 2050.  The demand for cobalt alone is going to increase by nearly 500 percent to meet the growing demand for clean energy.  Many of these critical minerals are found in the deep seabed.  Our Cook Islands nodules contain a high concentration of these minerals and are vital to the transition to a low carbon economy.  Again our ocean holds the key to meeting some of the world’s greatest challenges such as combating climate change and ensuring affordable and clean energy for all,” said Brown. 

In 2012, the Cook Islands Government set up its Seabed Minerals Authority to administer all relevant work and in anticipation that seabed mining will transition to become a full-fledged industry in the future.  

The Authority’s Commissioner Alex Herman described the exploration licensing process as “a major step towards achieving the vision for our seabed minerals sector.” 

“Much has been achieved. Much remains to be done. However I am confident in the processes that we have set up and that we have a sound foundation on which to build the Authority’s core role, which is to administer, manage and regulate the conduct of seabed minerals activities in our waters,” Herman said. 

“Our licensing framework contains a number of independent checks and balances such as our independent licensing panel and a separate permit body for environmental approvals.  It also requires that key environmental principles are upheld and met.  Equally important, it serves the interest of our communities, for example through our advisory committee who will share and make recommendations to the Authority on community perspectives,” she added. 

COVID, climate and oceans were high on the agenda, as foreign ministers and officials from around the region met online on 14 October, for the 2020 Forum Foreign Ministers Meeting (FFMM).

This year’s ministerial summit focussed on the COVID-19 crisis and post-pandemic recovery; actions to address the ongoing challenge of climate change; policy on oceans and the impact of sea level rise on maritime boundaries; and finalising an agenda to place before the virtual meeting of Pacific Islands Forum leaders, likely to be held in early November.

Each year, a Forum Officials Committee meets to discuss the draft agenda for the annual Forum, and thrash out initial draft language that can square the circle over sensitive issues. In 2015, a Forum Foreign Ministers Meeting was added to the list of regional meetings, designed to free up more time for Presidents and Prime Ministers to talk freely amongst themselves at the annual leaders’ summit.

Pandemic response

Opening the online FFMM, Pacific Islands Forum Secretary General Dame Meg Taylor noted the success of regional co-operation in the early days of the pandemic: “Using available regional mechanisms such as the Biketawa Declaration and the Boe Declaration, we were able to achieve a world first with the establishment and operationalisation of the Pacific Humanitarian Pathway on COVID-19, our regional response platform which has been able to move around 47,000 kilograms or 466 cubic metres  of medical and humanitarian supplies through our region.”

The regional response to COVID-19 initially prioritised the distribution of medical supplies, testing kits and technical assistance. But Forum member countries, especially those without any confirmed cases of coronavirus, are increasingly looking at the social and economic damage caused by border closures and disrupted trade and tourism.

Tuvalu’s Foreign Minister Simon Kofe chaired the ministerial summit and spoke to journalists after the meeting. He highlighted “the need to address the disproportionate effect of the COVID-19 crisis on vulnerable groups, including persons with disability, the elderly and women and girls - an issue faced by the full Forum membership.”

One ongoing challenge for smaller island states is to organise the return of citizens who have been working or studying abroad. Kiribati and Tuvalu are seeking assistance from the United Nations and neighbouring countries to bring home seafarers and seasonal workers who must transit through regional travel hubs like Auckland, Nauru or Nadi. The Tuvalu Foreign Minister recognised that many of his own nationals have found it hard to return home and “hundreds of i-Kiribati seafarers are amongst those in limbo as they were at sea, awaiting repatriation home and they’ve been stuck for many months.”

The FFMM proposed further discussions on a regional quarantine facility and travel bubbles to allow the transit of affected workers.

Simon Kofe stressed that developing countries need economic support during the recovery, but also ongoing medical assistance: “Ministers highlighted the need for cooperative, multilateral approaches to allow equitable access to trusted and certified COVID-19 tests, treatments and vaccines and ensuring their accountable and transparent procurement and distribution.”

Dame Meg Taylor confirmed that access to vaccines was a crucial next step in the regional response: “Our governments have been working very closely with different groupings to make sure that the Pacific secures vaccines. We had a very strong commitment from the Australian Prime Minister during this meeting that Australia would make sure that as they access vaccines, they would ensure that the Pacific was also able to access that vaccine.”

At a time of geopolitical contest in the region between China and the ANZUS allies, the Forum Secretary General diplomatically noted that Australia was not the only potential source for vaccines: “The leaders - all of them, hopefully - will be emphasising that we get our fair share of the vaccines and this is not just through Australia and New Zealand. If there are opportunities for vaccines from elsewhere that have been cleared, I know there is some of our countries that are working with different groupings to ensure that those vaccines will be available.”

The foreign ministers discussed a common statement “Protecting the health and well-being of the Blue Pacific”, to be presented to leaders and then to the forthcoming Special Session of the United Nations General Assembly on COVID-19 in December.

Climate policy

In her opening speech to the meeting, Dame Meg Taylor stated: “Notwithstanding COVID-19 and whether there is a vaccine today or tomorrow, we will continue to face a more pressing challenge, the existential threat of climate change and its related impacts.”

The Republic of Marshall Islands (RMI) was the first Pacific country to lodge an updated Nationally Determined Contribution (NDC) under the Paris Agreement on Climate Change, and has been calling on fellow Forum members to put forward more ambitious NDCs.

After the FFMM, RMI Minister of Foreign Affairs and Trade Casten Nemra said: “The Pacific region reaffirmed at ministerial level the determination to uphold the Paris Agreement and to deliver new, more ambitious nationally determined contributions in this fifth anniversary year of the landmark international accord. Amid the COVID-19 pandemic, new climate ambition in the Pacific is indispensable to our building back better.”

Secretary General Taylor acknowledged that “for some countries, coming through with NDCs may pose some internal challenges,” but said the FFMM had reaffirmed the regional policy adopted at last year’s Forum Leaders Meeting in Funafuti: “The ministers reaffirmed their support for the ‘Kainaki II Declaration for Urgent Climate Action Now ’ and that is as important this year as it was last year.”

Marshall Islands is currently a member of the UN Human Rights Council (UNHRC), and is using this position to leverage greater action on climate change. At the FFMM, Foreign Minister Nemra obtained regional support from his counterparts to campaign for a UN Special Rapporteur on climate change and human rights. Fiji is currently another island member of the UNHRC, and backed this initiative in the meeting.

Nemra explained: “In endorsing the creation of a dedicated new UN Special Rapporteur on climate change and human rights, the Pacific region will remain at the forefront of ambitious new actions to uphold rights threatened by the climate emergency facing all societies. We look forward to working with the entire region and the international community, as well as within the UN Human Rights Council, to secure this vital new mandate for overcoming the climate crisis by next year.”

This year’s 26th UNFCCC Conference of the Parties in Glasgow (COP26) was deferred because of the pandemic, but there are still regional and global efforts to increase ambition before the meeting, to be held in late 2021. The outcome of November’s Presidential election in the United states will have a major impact on the Paris Agreement, but Pacific island nations are also looking for greater climate action from their Kiwi neighbours, following Saturday’s elections in New Zealand.

Just days after the FFMM, the major victory of the NZ Labour Party in national elections will impact regional as well as domestic policy. Under Prime Minister Jacinda Ardern, Labour now holds a majority in its own right. The elections saw the political demise of former Deputy Prime Minister and Foreign Minister Winston Peters, a long-standing figure on the national and regional stage. Peters’ NZ First party failed to meet the 5 per cent threshold to be represented in Parliament and his departure from the former governing coalition removes a constraint on New Zealand’s climate ambition.

This was highlighted the day after the NZ election, with Fiji Prime Minister Voreqe Bainimarama welcoming Jacinda Ardern’s victory in a tweet: “Proud to see my friend @jacindaardern score a historic victory. With a full embrace of a #netzerocommitment by 2050, this was also a landslide win for the climate. Your friends in Fiji are ready to keep moving with our work to make the Pacific and our planet a better place.”

The 2019 leaders meeting in Funafuti saw close collaboration between Bainimarama and Ardern, leaving Australian Prime Minister Scott Morrison isolated in his opposition to more urgent, ambitious targets on greenhouse gas emissions and reduced use of fossil fuels.

Forum communiques usually include enough wiggle room to allow members to paper over their differences on climate policy, but the FFMM’s reaffirmation of the Kainaki II Declaration places the Morrison Government in a difficult position. Kainaki calls on parties to the Paris Agreement “to formulate and communicate mid-century long-term low greenhouse gas emissions development strategies by 2020. This may include commitments and strategies to achieve net zero carbon by 2050.”

The Morrison government has refused to adopt such a strategy, even though a broad coalition of Australian organisations – from environmental groups to the National Farmers Federation and Business Council of Australia – have supported the objective of net zero emissions by 2050. Despite the recent adoption of a “technology road map” on climate, Morrison may face increasing pressure at this year’s Forum leaders meeting over Australia’s lack of ambition on emissions reduction.

Dame Meg Taylor suggested that attempts to water down a Forum consensus on climate action would not constrain island nations in the lead up to COP26: “What we really need to do is to ensure that the Kainaki II Declaration is the basis for our discussion. However there was discussion and acknowledgement that there are other groupings too like the PSIDS, AOSIS and also the Higher Ambition Coalition that many of our member states - particularly the island countries - do belong to. They are going to push hard to make sure that the commitments under the Paris Agreement are met.”

Beyond climate, the Forum Foreign Ministers discussed regional oceans policy, despite the disruption of Blue Pacific advocacy during the UN Year of the Ocean. With Palau scheduled to host a regional oceans summit in December, the Forum will consider establishing a subcommittee to continue work on defining legal maritime boundaries.

At the meeting, Australian Foreign Minister Marise Payne announced that the new ‘Pacific Fusion Centre’, currently operating from Canberra, will be based in Vanuatu. The centre will collate information from security and fisheries agencies across Pacific Island countries to provide more comprehensive “real time maritime domain awareness.”

Online leaders’ summit

The 2020 Forum leaders meeting was originally scheduled for August in Vanuatu, to coincide with the 40th anniversary of independence. However health and travel restrictions in the COVID-free nation led to the postponement of a face-to-face meeting. Since then Prime Minister of Tuvalu Kausea Natano, the current Forum Chair, has been negotiating with other leaders to finalise a date for a virtual summit, with a restricted agenda.

Beyond key agenda items of the post-pandemic recovery and climate policy, this year’s meeting must make a decision on the appointment of a new Secretary General for the Pacific Islands Forum Secretariat, as Dame Meg Taylor ends her second term of office next January.

Speaking after the FFMM, Tuvalu's Foreign Minister Simon Kofe said that Prime Minister Natano was still working to finalise a date for the online summit, which should be decided within days: “The process will be determined by the leaders. But in terms of dates, we are looking at November. The majority of members have expressed their preference for the first week of November.”

Five Micronesian leaders have threatened to withdraw from Forum activity if their candidate for Secretary General, RMI’s Gerald Zackios, is not appointed to the post. But Simon Kofe believes that the issue will be resolved, noting: “It's something that the leaders will look into. We are certainly very concerned about the threat from the Micronesians to pull out from the Forum.”

Summing up a successful meeting, Kofe said: “It’s been an extraordinary year this year. We are coming to the end of 2020 and I would say that we faced a number of challenges this year and there are more challenges ahead of us. But as the Pacific, we can draw on our culture and our values to be able to maintain our unity and our resilience through these testing times.”

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