NAV­I­GAT­ING SHOCKS FROM PAN­DEMIC TO CY­CLONE HAROLD

WHILE SEV­ERAL OF THE WORLD’S LARGER ECONOMIES ARE STRUG­GLING TO CON­TAIN THE VIRUS, FIJI HAD ONLY 18 KNOWN CASES, RECORDED ZERO DEATHS AND WITH­STOOD TROP­I­CAL CY­CLONE HAROLD

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The pan­demic has laid bare the vi­tal role of both bi­lat­eral and mul­ti­lat­eral de­vel­op­ment part­ners in help­ing Fiji and other small is­land de­vel­op­ing states min­imise their ex­po­sure to shocks, and the key lessons coun­tries can learn from Fiji. Re­port by Nilesh Prakash, Prashant Chan­dra and Caitlin Smith*

Coron­avirus has up­ended the global econ­omy, pre­sent­ing gov­ern­ments with a chal­lenge: how to nav­i­gate a se­vere, ex­ter­nal threat in a man­ner that strikes the right bal­ance be­tween ef­forts to pro­tect pub­lic health and peo­ple’s liveli­hoods.

The pan­demic hit part­way through a three-year part­ner­ship be­tween the WRI Fi­nance Cen­tre and the Fi­jian Min­istry of Econ­omy, pro­vid­ing WRI with a unique in­sight into the chal­lenges and lessons to be learned on re­silience, pre­pared­ness and global co­op­er­a­tion from the small is­land na­tion.

While sev­eral of the world’s larger economies are strug­gling to con­tain the virus, Fiji had only 18 known cases, recorded zero deaths and with­stood Trop­i­cal Cy­clone Harold, a cat­e­gory 4 storm, as cases were peak­ing.

For Fiji, where 60 per cent of deaths are due to chronic health con­di­tions that are known to in­crease the mor­tal­ity of COVID-19, that is a tremen­dous ac­com­plish­ment.

The coun­try de­clared it­self COVIDfree on June 5, but to get there, had to close its bor­ders and tourism sec­tor. Fiji’s ex­pe­ri­ence with COVID-19 and Cy­clone Harold is a re­minder that, amid any global cri­sis, the tools avail­able to the small­est and most vul­ner­a­ble coun­tries are three­fold: prepa­ra­tion and proac­tive in­vest­ments in re­silience or re­sponse; close col­lab­o­ra­tion with in­ter­na­tional de­vel­op­ment part­ners; and an em­brace of the key pil­lars of sus­tain­able de­vel­op­ment: en­vi­ron­men­tal health, so­cial and hu­man health, and eco­nomic growth.

FIJI HEADS OFF CORON­AVIRUS

The Fi­jian govern­ment be­gan pre­par­ing for COVID-19 in late Jan­uary, work­ing closely with the World Health Or­gan­i­sa­tion, New Zealand and Aus­tralia to build its do­mes­tic ca­pac­ity to iden­tify, trace and con­tain po­ten­tial cases and to pro­cure ad­di­tional ven­ti­la­tors, med­i­cal masks and other crit­i­cal items. In early Fe­bru­ary, Fiji be­gan im­ple­ment­ing, and grad­u­ally tight­en­ing, re­stric­tions on trav­el­ers who had spent time in ex­ist­ing hotspots.

When Fiji con­firmed its first case of the coron­avirus on March 19, it was pre­pared. Within a week, 32 fever and test­ing clin­ics opened. The Min­istry of Health de­ployed con­tact trac­ing teams to track and mon­i­tor all pos­si­ble cases.

On March 25, Fiji grounded com­mer­cial in­ter­na­tional flights and sealed its bor­ders. The Fi­jian govern­ment locked down Lau­toka and Suva, where cases were con­firmed, banned so­cial gather­ings and im­ple­mented a na­tion­wide cur­few. Be­tween March 19 and April 20, Fiji con­firmed six clus­ters and 18 cases of COVID-19, but the dis­ease never reached com­mu­nity spread.

Fiji did this de­spite be­ing hit by a cy­clone mid-pan­demic. In early April, TC Harold hit Fiji as a cat­e­gory 4 storm. Harold in­flicted at least $44 mil­lion in dam­ages, de­stroyed at least 635 houses and dam­aged an ad­di­tional 2100 homes. (The storm in­flicted far more se­ri­ous dam­age to the Solomon Is­lands, Van­u­atu and Tonga.)

Fiji is ex­pe­ri­enced in deal­ing with cy­clones—ev­ery year brings a six-month cy­clone sea­son—and it’s pos­si­ble this in­sti­tu­tional mus­cle mem­ory sped the coun­try’s COVID re­sponse.

In 2016, Trop­i­cal Cy­clone Win­ston, a se­vere cat­e­gory 5 storm, wiped out more than a third of the coun­try’s GDP in 36 hours. In re­sponse, the Fi­jian govern­ment launched the “Build Back Bet­ter” pro­gramme to re­build more than 200 pub­lic build­ings so they could with­stand com­pa­ra­ble fu­ture storms. TC Harold was the first sig­nif­i­cant storm to test the 181 schools and 25 pub­lic build­ings that have been com­pleted to date un­der “Build Back Bet­ter” pro­gramme. None were dam­aged.

DE­SPITE AVERT­ING VIRUS, ECON­OMY SUF­FERS

Al­though Fiji min­imised the pub­lic health im­pacts of COVID-19, it now con­fronts an eco­nomic catas­tro­phe. Tourism ac­counts for al­most 40% of the coun­try’s GDP. With the bor­ders closed since March 25, at least 150,000 Fi­jians, or al­most half the la­bor force, face ei­ther re­duced in­comes or job loss. The dam­age from TC Harold has com­pounded these costs. Al­though the govern­ment is ex­pected to cut spend­ing by more than 30%, it could face in­sol­vency by De­cem­ber 2020 if govern­ment rev­enues from tourism or other sources do not re­turn.

Amid these un­prece­dented cir­cum­stances, the Fi­jian peo­ple have moved to re-es­tab­lish tra­di­tional, non-cash means of eco­nomic ac­tiv­i­ties. Al­most 170,000 peo­ple have joined the “Barter for Bet­ter Fiji” Face­book group, which was es­tab­lished in mid-April and is run in­de­pen­dently by vol­un­teers.

The group pro­vides a plat­form for Fi­jians to ne­go­ti­ate their own trades, such as piglets for kayaks, with­out us­ing cash. By the end of May, it had re­ceived two small grants from UNDP and Aus­tralia to ex­pand be­yond Face­book. The group pro­vides a glimpse of the re­silience and com­mu­nal spirit of the Fi­jian peo­ple and a unique mea­sure of the coun­try’s eco­nomic tur­moil.

Through its COVID-19 Re­sponse Bud­get, the Fi­jian govern­ment is pro­vid­ing roughly $445 mil­lion (FJD$1 bil­lion) in eco­nomic stim­u­lus. But as a small is­land de­vel­op­ing coun­try, Fiji does not have the same ca­pac­ity as China, the United States or the Euro­pean Union to in­ject sev­eral bil­lion dol­lars into its econ­omy. In­stead, it must seek as­sis­tance from its in­ter­na­tional part­ners.

The as­sis­tance re­ceived from the global com­mu­nity to date has been in­valu­able. Bi­lat­eral part­ners, par­tic­u­larly Aus­tralia and New Zealand, pro­vided Fiji with vi­tal med­i­cal sup­plies, test­ing ca­pac­ity and cy­clone as­sis­tance, as well as roughly $9 mil­lion (FJD$20 mil­lion) in bud­getary sup­port. The Ja­panese In­ter­na­tional Co­op­er­a­tion Agency pro­vided al­most $20 mil­lion (FJD$45 mil­lion) in con­ces­sional loans, or loans ex­tended on more gen­er­ous terms that are avail­able on the in­ter­na­tional mar­kets, to re­spond to Cy­clone Harold.

The Asian De­vel­op­ment Bank has of­fered $200 mil­lion in con­ces­sional loans for COVID-19 and $400,000 in grants for Harold. The Fi­jian govern­ment is fi­nal­iz­ing $3.5 mil­lion (FJD$7.5 mil­lion) $3 mil­lion (FJD$6.4 mil­lion in loans) from the World Bank’s COVID-19 fa­cil­ity. Be­cause New Zealand de­clared it­self COVID-free on June 8 and Aus­tralia an­tic­i­pates reach­ing a sim­i­lar out­come soon, these gov­ern­ments are dis­cussing a virus-free travel bub­ble.

If Fiji were to be in­cluded, that bub­ble would pro­vide a vi­tal eco­nomic lifeline: the two coun­tries ac­count for roughly 65% of Fiji’s tourists.

In the words of Aiyaz Sayed-Khaiyum, Fiji’s Min­is­ter of Econ­omy, “A travel bub­ble that in­cludes Fiji along­side Aus­tralia and New Zealand would do far more good than any aid or as­sis­tance … we want to be in that bub­ble.”

HOW DE­VEL­OP­MENT PART­NERS CAN AS­SIST COUN­TRIES LIKE FIJI

The pan­demic has laid bare the vi­tal role of both bi­lat­eral and mul­ti­lat­eral de­vel­op­ment part­ners in help­ing Fiji and other small is­land de­vel­op­ing states min­imise their ex­po­sure to shocks, and the key lessons coun­tries can learn from Fiji.

Ex­ter­nal shocks will only grow more fre­quent with a chang­ing cli­mate. Like the coron­avirus, cli­mate im­pacts will not re­spect in­ter­na­tional bor­ders but pose po­ten­tially ex­is­ten­tial threats to the small­est, most vul­ner­a­ble coun­tries.

Here are three lessons from Fiji that demon­strate the role in­ter­na­tional part­ners can play:

■ In­ter­na­tional de­vel­op­ment part­ners con­trib­ute to the so­cio-eco­nomic sta­bil­ity of vul­ner­a­ble coun­tries, in­clud­ing small is­land de­vel­op­ing states. Fiji has lim­ited the health con­se­quences of both the pan­demic and the cy­clone, largely due to close col­lab­o­ra­tion with its de­vel­op­ment part­ners. The same part­ners con­tinue to pro­vide bud­get sup­port and other forms of fi­nan­cial as­sis­tance, which is vi­tal to keep­ing Fiji’s econ­omy afloat while the pan­demic con­tin­ues abroad and Fiji’s bor­ders re­main closed.

The pro­posed virus-free trans-Tas­man travel bub­ble of­fers an op­por­tu­nity for Fiji to restart its tourism sec­tor with­out ex­pos­ing it­self to a size­able pub­lic health risk.

■ In­vest­ing in re­silience pays off. In a re­port is­sued last fall, the Global Com­mis­sion on Adap­ta­tion found that in­vest­ments in re­silience can de­liver ben­e­fits that are two to ten times the ini­tial in­vest­ment. Fiji’s swift ac­tions to pre­vent a wide­spread COVID-19 out­break helped the coun­try avoid a health dis­as­ter and have put the Fi­jian govern­ment in a po­si­tion to dis­cuss join­ing a lim­ited re-open­ing for tourism. In an­other ex­am­ple, the coun­try’s “Build Back Bet­ter” pro­gramme, de­signed to help cit­i­zens with­stand an­other cat­e­gory 5 cy­clone, yielded im­pres­sive re­sults: none of the more than 200 build­ings con­structed were dam­aged by Harold, shield­ing both the Fi­jian peo­ple and the govern­ment bud­get from cat­a­strophic costs.

■ Ef­forts to re­build should em­brace col­lab­o­ra­tion and sus­tain­able de­vel­op­ment. As all coun­tries be­gin re­build­ing their economies af­ter COVID-19, they need to em­brace re­silience and sus­tain­abil­ity. Fiji’s ex­pe­ri­ence is a clear re­minder that in­vest­ing in so­cial and en­vi­ron­men­tal needs is the ba­sis of eco­nomic sta­bil­ity. Fiji’s [Na­tional Adap­ta­tion Plan](https://www4.unfccc.int/sites/NAPC/Doc­u­ments/Par­ties/Na­tional Adap­ta­tion Plan_Fiji. pdf), pub­lished in 2018, iden­ti­fies 160 in­ter­ven­tions to build cli­mate re­silience through­out the econ­omy and help main­stream cli­mate con­sid­er­a­tions in crit­i­cal sec­tors such as pub­lic health, agri­cul­ture and forestry, to si­mul­ta­ne­ously pro­mote cli­mate adap­ta­tion and fa­cil­i­tate re­silient eco­nomic growth. The NAP in­ter­ven­tions in­clude the main ob­jec­tive of the Build Back Bet­ter Pro­gramme – which is to en­sure that ev­ery com­mu­nity has a cy­clone-re­silient school or pub­lic shel­ter.

In a global cri­sis, no coun­try is truly an is­land. Cri­sis re­sponse is most ef­fec­tive and ef­fi­cient if de­liv­ered with the sup­port of the in­ter­na­tional com­mu­nity.

Proac­tive in­vest­ments in pre­pared­ness and re­silience are in­dis­pens­able nav­i­ga­tion tools dur­ing these storms.

*In March 2019, the WRI Fi­nance Cen­tre en­tered a three-year part­ner­ship with the Min­istry of Econ­omy of Fiji to help im­prove Fiji’s un­der­stand­ing of and ac­cess to cli­mate fi­nance and to build up the cli­mate fi­nance ca­pac­ity of the Min­istry’s Cli­mate Change Di­vi­sion. Caitlin Smith is WRI’s em­bed­ded ad­vi­sor to the Fiji Cli­mate Change Di­vi­sion. Prashant Chan­dra and Nilesh Prakash are for­mer em­ploy­ees of the Min­istry of Econ­omy but re­main en­gaged in Fiji’s cli­mate fi­nance space. The views ex­pressed in this blog do not rep­re­sent the views of the Fiji Min­istry of Econ­omy.

Min­is­ter for Econ­omy Aiyaz Sayed-Khaiyum.

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