NUKU’ALOFA, TONGA (23 January, 2013) – Despite facing immediate economic challenges, far-reaching private-sector oriented reforms will bring long-term benefits to the Tongan economy, according to the Asian Development Bank’s (ADB) Private Sector Assessment for Tonga, released today.
The private sector assessment recommends ways to improve the business environment and promote growth by removing constraints that raise business costs and discourage investment. It identifies policies to promote growth and alleviate poverty by reducing the role of the state in the economy, upgrading infrastructure, improving access to finance and modernizing business laws.
“The publication provides a guide to the development of a vibrant private sector in Tonga,” said Andrea Iffland, Regional Director of ADB’s Pacific Liaison and Coordination Office in Australia. “The private sector assessment aims to assist the government with job creation and suggests ways in which the country’s prosperity could be improved by removing constraints to investment.”
The ADB report shows that Tonga has embraced a number of private-sector reforms aimed at improving the environment for business in Tonga. Reforms include: Passing a new Companies Act in 2009, the installation of an electronic registry which will reduce the cost of starting a business, simplifying the business licensing regime and the government has embarked on a program to improve the efficiency of Tonga’s state-owned enterprises. ADB supported the implementation of many of these reforms, which will bring long-term benefits to the economy and the people of Tonga.
The assessment concludes that while much has been achieved to date, much more needs to be done. The study’s recommendations will help address constraints to private sector growth and development.
ADB’s private sector assessment of Tonga was prepared in close consultation with government, and the private sector. It is part of ongoing analytical work undertaken by the Pacific Private Sector Development Initiative (PSDI) that is co-financed by ADB and AusAID. PSDI is a knowledge hub with a team of technical experts who focus on: business law reform, access to financial services, state-owned enterprise reform and public-private partnerships. Through their reform activities, ADB in partnership with the governments of Pacific developing member countries and other development partners is lifting the barriers to business growth in the Pacific.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members – 48 from the region.