Inflation will remain steady and the economy will grow in 2018, but Tonga’s economic future could be swept away by climate change, the Asian Development Bank has warned.
According to the ADB’s latest Pacific Economic Monitor, inflation will remain unchanged at 2.5% and the GDP will grow from 2.8% to 3.5% in 2018.
However, the ADB also warned that Tonga ranked second highest country (behind Vanuatu) at risk from natural disasters.
Tonga’s location exposed it to a higher chance of natural disaster.
Its placing was also determined by its ability to cope with a disaster and to adapt in the aftermath.
“Tonga is already experiencing the effects of climate change, as increasing variability in rainfall patterns is causing more severe flooding and droughts,” the Pacific Economic Monitor said.
“The rising ocean temperatures have led to coral bleaching and destroyed natural coastal barriers, and sea level rise is contributing to coastal erosion.
“These changes have increased the country’s exposure to disasters caused by climatic events, such as tropical cyclones and storm surges, which have inflicted significant economic losses.
“Tonga is also highly vulnerable to earthquakes and tsunamis because of its location and geology.”
The Monitor said Cyclone Ian had cost Tonga TP$55.5 million, or the equivalent of 12.5% of GDP.
The ADB said Pacific nations need to do more to adapt to more extreme weather conditions.
Changes were needed to mitigate disaster risks to improve the region’s economic growth and development prospects.
