World Bank Releases Tonga Poverty and Equity Assessment: Key Insights and Recommendations for Progress

Remittances have played a crucial role in Tonga’s poverty alleviation efforts, with nearly 90% of households receiving remittances in 2021, accounting for 45% of the country’s GDP.

The World Bank has unveiled its latest report, the Tonga Poverty and Equity Assessment, which provides a comprehensive analysis of poverty and inequality trends in Tonga from 2015 to 2021. Drawing on data from the Household Income and Expenditure Surveys, this assessment offers valuable insights into monetary poverty changes in the country while proposing recommendations for future progress.

Despite facing significant challenges—including devastating cyclones, the COVID-19 pandemic, and the 2022 volcanic eruption—Tonga has managed to reduce its poverty headcount from 27.4% in 2015 to 20.6% in 2021. The report also indicates a decline in inequality; however, it points out that rural areas continue to experience higher poverty rates compared to urban centers.

Stefano Mocci, the World Bank Resident Representative for the South Pacific, remarked, “This new research gives us a clearer picture of where Tonga stands today and how we can work with the government and other partners to continue to reduce poverty. Investing in education and health along with creating more job opportunities will be critical to Tonga’s success moving forward.”

Role of Remittances

Remittances have played a crucial role in Tonga’s poverty alleviation efforts, with nearly 90% of households receiving remittances in 2021, accounting for 45% of the country’s GDP. While the report acknowledges the essential support these funds provide, it also emphasizes the need for income diversification. Relying heavily on temporary labour migration can lead to labour shortages and adverse social impacts on families and communities. Therefore, ensuring the sustainability of these migration programs while addressing their downsides is vital for Tonga’s long-term development.

Improvements in Living Standards

The assessment highlights significant advancements in living standards from 2015 to 2021:

The percentage of households owning essential assets such as cars increased from 37% to 55%.

Mobile phone ownership rose dramatically, from 82% to 97% of households.

Access to basic sanitation improved, with 90% of households having flush toilets in 2021, compared to 82% in 2015.

Despite these improvements, the report notes persistent gaps between rural and urban areas regarding access to services and economic opportunities.

Recommendations for Future Progress

The Tonga Poverty and Equity Assessment underscores several crucial areas for intervention to further alleviate poverty and inequality:

Strengthening Social Protection Systems: The report emphasizes the importance of robust social protection mechanisms that can rapidly respond to crises, particularly natural disasters. These systems should prioritize vulnerable populations, including women, seniors, and individuals with disabilities, ensuring a strong safety net to prevent households from slipping back into poverty.

Enhancing Education and Job Training: The assessment highlights the need to improve education and vocational training programs, enabling more Tongans to secure better-paying jobs both domestically and abroad. Enhancing skills is essential for diversifying the economy, especially in high-growth sectors like tourism.

Promoting Digital Literacy: Investing in digital literacy programs will help Tongans engage in emerging sectors, thereby creating opportunities for economic growth.

The Tonga Poverty and Equity Assessment serves as a crucial tool for understanding the challenges and progress in poverty reduction within the country. By implementing the report's recommendations, Tonga can navigate its challenges more effectively, paving the way for a more resilient and inclusive future for all its citizens.

For more detailed insights and data, the full report is available on the World Bank’s official website.