GAR Fiji - Country Policy Note
Introduction
The Fiji Islands are located in the equatorial belt in the Pacific Ocean (18 degree S,
175 degrees E), roughly one third of the way between Australia and the US. The
country experiences a tropical South Sea maritime climate, frequently affected by
tropical cyclones. In 2007, the population is estimated at 860 000, with indigenous
(Melanesian) Fijians constituting 56 per cent of the population and IndoFijians
comprising 36 per cent (Fiji Bureau of Statistics 2008).
Fiji has been struggling over the past years having low and negative growth rates
(Figure 1). The economy has conventionally been based on primary production.
Subsistence agriculture forms a significant portion of the total agricultural produce
and people in the rural areas are dependant on this. A recent decline in the
agricultural sector in the last decade has meant increasing reliance on the
manufacturing sector in the economy (Figure 2).
Figure 1
GDP by Sector 1995-2007
700
Agriculture
600
Fishing
Forestry
$ millions
500
Mining & Quarrying
Manufacturing
400
Electricity & Water
300
Building & Construction
Wholesale and retail
200
Transport and communications
Finance
100
Community & Social
0
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Year
Source: Fiji Islands Bureau of Statistics 2008
A fundamental issue has been the recent decline in the sugar sector which
underpinned the Fijian economy for almost a century. The recent decline arises partly
because of deterioration in the sugar industry governance, the continuing decline in
sugar cane production, the end of preferential pricing under the European Union and
also because of the non-renewal of the agricultural leases to sitting tenants. The
effect has been a significant reduction in rural employment and the migration of large
numbers of people from rural areas in urban areas in search of jobs.
Poverty Profile and Dynamics
In Fiji, poverty is defined as a minimum amount of income an individual requires to
meet basic needs. This ‘Basic Needs Poverty Line’ (BNPL) for Fiji varies according to
which of the two key ethnic groups of Fiji are being discussed, reflecting their natural
resource endowments. As of 2002-2003 (the last definition of the BNPL), the BPNL
fell between US$ 66-80 per week – or US$ 3450-4140 per year. Any household with
income less than BPNL was defined as being in poverty (Narsey 2008).
Figure 2
Percentage Change in Agricultural GDP and Aggregate GDP
Percentage Change in the Agricultural and Aggregate GDP
20.00
15.00
10.00
5.00
%
% Change in Agricultural GDP
0.00
1994
% Change in GDP
1996
1998
2000
2002
2004
2006
2008
-5.00
-10.00
-15.00
Year
Source: Reserve Bank of Fiji 2008
Assessments of poverty for the Government of Fiji are made through household
income and expenditure surveys (HIES). According to the latest HIES, 35 per cent of
the population were living below the poverty line in the 2002-2003 (Fiji Islands
Bureau of Statistics 2007). This represented an increase of 46 per cent from the
previous assessment. Among the factors contributing to the increase in poverty are
rural to urban migration and political developments. (Two political coups occurred in
1987 and 2000 resulting in considerable upheaval.)
Figure 3
Incidence of Poverty in Fiji
Source: Fiji Islands Bureau of Statistics 2008
Unfortunately, HIES data over time is restricted to the only three HIES in the last 30
years (Fiji Islands Bureau of Statistics 2008). A fourth study is currently in being
conducted by the UNDP.
In the absence of time series data on the BNPL, trends in poverty in Fiji were
investigated using proxy data. For example, the Human Development Index
integrates proxies for health (life expectancy), education (literacy and school
enrollment), and the standard of living (GDP per capita). Fiji has a HDI of 0.762,
placing it 92nd in the world in terms of human development. The HDI for Fiji displays a
slight increase over time followed by a decrease in 1995 and 1998, and then an
increase.
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Figure 4
HDI Values for Fiji
Source ADB 2008
While the overall HDI for Fiji has remained relatively stable in recent years, its
component measures have not. For example, although primary school enrollment
rate was 100 per cent, the number of children reaching higher grades is significantly
lower. This may be related to the costs of secondary education. GDP per capita has
been erratic over the past years with a significant decline in 2007.
The Human Poverty Index measures the incidence of poverty via key welfare
measures such as the percentage of people with access to health services and safe
water and the percentage of malnourished children under five. Fiji is ranked 50th in
the world in terms of the HPI.
Disaster Profile
Data on natural hazards and disasters for Fiji was obtained from various sources
including National Disaster Management Office, Fiji Meteorological Service, EMDAT
and SOPAC’s Pacific Disaster Net for the 1970-2007 period. The type of data
provided in these records varies. For example, the Government of Fiji collects
disaster data on events declared as national disasters while EMDAT provides
records on disasters only where 10 or more fatalities occur. By comparison, data
from the Fiji Meteorological Service covers a broader range of lesser and minor
events but do not include information on damage or fatalities which the Government
of Fiji and EMDAT do.
According to these aggregated official records, Fiji is regularly exposed to natural
disasters related to geohazards and hydro meteorological factors. From 1970-2007,
Fiji officially reported a total of 124 disasters, with hydro meteorological disasters,
tropical cyclones, storms and droughts accounting for 90 percent of the events
(Figures 5 and 6). Ten disasters were caused by earthquakes and 2 due to tsunamis.
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Figure 5
Major Natural Disasters in Fiji by Type
Disasters Over 1970-2007 Period
10
Number
8
6
4
2
20
06
20
04
20
02
20
00
19
98
19
96
19
94
19
92
19
90
19
88
19
86
19
84
19
82
19
80
19
78
19
76
19
74
19
72
19
70
0
Year
Tropical Cyclone
Flood
Drought
Earthquake
Severe Local Storm
Over the past 37 years, an average of 3.6 natural disasters occurred in Fiji per year.
There appears to have been a sharp increase in the number of floods reported in Fiji.
Tropical cyclones occur on a frequent and regular basis.
Figure 6
Relative Importance of Major Disasters in Fiji
M ajor Disasters in Fiji 1970-2007
2% 5%
8%
50%
33%
2%
Drought
Earthquake
Flood
Severe Local Storm
Tropical Cyclone
Tsunami
The cumulative cost of damages caused by all reported disasters during the 19702007 period are estimated to be in the region of US$ 532 million. A total of
approximately 2 million people were directly affected and during the same period with
419 lives being lost.
Natural hazards in Fiji are of widely varying intensity. For the purposes of this study,
‘intensive’ disasters were defined as those that resulted in more than 5 deaths or
caused damage costs of more than FJ$ 5 million per incident. 1 Extensive disasters –
1
The threshold of 5 fatalities was used to separate the intensive and extensive risks since 60 per cent of
reported events fell in the 1-5 death category. For the estimated costs, $5 million was taken as the
threshold since 26 per cent of reported events fell in the below 5 million category. This was the highest
out of all other categories.
4
Tsunami
those that cause lower levels of damage per incident – are defined as those events
that resulted in 5 fatalities or less or which had a cost of FJ$ 5 million or less.
Based on the existing data sets, it appears that intensive disasters account by far for
the greatest portion of deaths and monetary losses in Fiji over time. Over 1970-2007,
intensive events accounted for 84 per cent of reported natural hazard fatalities (405)
as well as for 99 per cent of reported monetary losses (US$ 428 million) (figures 7
and 8). However, a difference between the effects of extensive and intensive events
may arise because many extensive events go unreported. The Government of Fiji
collects disaster data only on those events declared as national disasters. Data on
minor disasters is therefore potentially an issue that needs further attention in Fiji if
analysis of disasters is to be more accurate.
Figure 7
Extensive/Intensive by Fatalities
70
60
# of Fatalities
50
40
Extensive
Intensive
30
20
10
19
70
19
72
19
74
19
76
19
78
19
80
19
82
19
84
19
86
19
88
19
90
19
92
19
94
19
96
19
98
20
00
20
02
20
04
20
06
0
Year
Figure 8 (Costs presented in FJ$)
Extensive/Intensive by Estimated Cost
120000000
100000000
Cost
80000000
Extensive
60000000
Intensive
40000000
20000000
19
70
19
72
19
74
19
76
19
78
19
80
19
82
19
84
19
86
19
88
19
90
19
92
19
94
19
96
19
98
20
00
20
02
20
04
20
06
0
Year
Poverty-Disaster Linkages
Regression analysis using available quantitative data was applied to assess the
relationship between natural disasters and poverty in Fiji.
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Partial Analysis
Broadly speaking, analysis of data2 indicates that the greater the incidence of
poverty, the greater the impact is of natural disasters. Treating consumption
expenditure as a dependent variable, it was found that, in disaster years, as the
number of people affected by natural disaster increased, aggregate consumption
expenditure decreased, as did the disposable income. In other words, disaster
reduced wealth/increased poverty. Preliminary results also suggest that disaster was
negatively correlated with GDP (reinforcing the idea that disasters reduce wealth),
although the coefficient was not significant.
Regression analysis using OLS
Over 1970-2002, the number of people affected by disasters was negatively
correlated with HDI and disposable income 3– in other words, analysis suggests that
greater poverty means that more people will be affected by natural disasters in Fiji.
This implies that measures to address poverty are likely to reduce the number of
people affected by disasters.
Preliminary analysis also suggests that population affected by disaster and lives lost
affected HDI negatively. In other words, natural disaster decreased wealth/increased
poverty. This implies that policies that reduce or mitigate natural disasters could
reduce poverty in Fiji, such as by improving GDP per capita.
The aggregate level data and the proxy measures available for use in this analysis
were extremely limited for both disaster and poverty measures. Accordingly, all
analysis is still highly preliminary. Nevertheless, the OLS regression analysis
suggests that poverty and natural disasters are interrelated, with the relationship
being weak in some results and strong in others. In future, better availability of time
series data and cross sectional data at the household and district level, would permit
the relationship between natural disasters and poverty to be determined with greater
degree of confidence.
Conclusions and recommendations for the future
Preliminary analysis based on limited empirical data suggest a two way relationship
between poverty and disaster: that natural disasters are actually worsening Fiji’s
current development levels (including GDP per capita) and that worsening
development levels (increasing poverty) are making the community more vulnerable
to natural disasters. Over time, intensive disasters are leading to the greatest
monetary losses in the Fiji economy. Nevertheless, smaller scale extensive disasters
continue to impact the poor given their high frequency.
Further research is needed to define specifically the types of development strategies
needed that can help reduce both poverty as well as the impacts of disaster, and
build resilience to future disasters. However, in the interim, some recommendations
can be made to assist Fiji.
Data quality
Data coverage and quality of both disaster events and their effects on household
welfare, sectoral activities and national economy needs significant improvement in
Fiji as the existing data from reports mostly do not cover the household level
2
Number of people affected, number of lives lost, consumption expenditure and disposable income
OLS analysis was undertaken using the number of people affected as a measure of disaster impact as
dependent variable as a function of HDI, household disposable income and devaluation and disasters as
a dummy variable.
3
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assessments of impacts. Indirect impacts such as the impact on human development
are also often over looked. There is need for consistent recording of damage by
location, including on number of houses and people affected, number of lives lost,
estimated damage at the household income and well being. Moreover, data should
also be recorded on extensive events in regards to the impacts at the household
level and at the same time assessments can also include issues such as income
before the hazard and the impact on it after the hazard. Household income and
expenditure information also needs to be more regularly collected using a statistically
valid sampling strategy. Time series information on factors such as the Human
Poverty Index and its key determinants would be helpful to inform both development
policy in Fiji and, in light of this analysis, disaster policy. Regular surveys of the
frequently hit areas will also help in assessing the linkages in future and this
recordings should be consistent.
Recommendation 1: Improve data coverage and data quality about hazards and its
impact on human livelihood and human wellbeing at all levels, household, sectoral
and the national.
Considering the direct relationship between disaster and poverty, there is a need to
adopt a tandem approach to tackle disaster risk reduction and poverty concurrently.
For instance, strategies to mainstream disaster risk management should reduce
poverty and improve economic strength. Vulnerability to natural disasters can be
reduced by countries adopting a pro-poor development strategies and households
adopting risk reduction strategies, as well as better preparing for disasters. At the
national level, countries may also need to develop better early warning systems,
communication strategies as well as more effective disaster management strategies
to minimize the negative effects of disaster and help reduce poverty. At the same
time, reductions in poverty may better enable communities to cope with disasters.
Recommendation 2: Adopt disaster risk management strategies as a means to
reduce poverty and thereby improve economic development.
Recommendation 3: Adopt poverty reduction strategies such as improving the
human capital by making education available at low costs and promoting
development in the rural areas to reduce migration as a means to reduce household
and national level vulnerability to disaster.
References
ADB 2008, Key Indicators for Asia and the Pacific, Asian Development Bank.
Fiji Islands Bureau of Statistics 2008, Key Statistics, Suva Fiji.
RSB (Reserve Bank of Fiji) 2008, Quarterly Review, Suva.
Narsey, W. 2008, The quantitative analysis of poverty in Fiji, Fiji Islands Bureau of
Statistics and The School of Economics, University of the South Pacific, Fiji.
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