The economy

Tokelau is aid-dependent. The people are able to be self-sufficient within the traditional subsistence economy but the recurrent and development budgets will continue to be the responsibility of New Zealand in the foreseeable future. There is little opportunity for diversification. GDP per capita was estimated in 1980 at $A478. There are no recent figures.

Primary production

Agriculture. The physical characteristics of the atolls allow very little scope for economic development and the few natural resources are sufficient only to meet the needs of the people. Apart from the manufacture of copra, agricultural products are of a basic subsistence nature. Food crops consist of coconuts, pulaka, breadfruit, taamu, papaya, edible padanus fruit and bananas. Many other seeds have been tested but because of the poverty of the soil very poor results have been achieved. Crops, particularly coconut trees, must be protected from the Polynesian rat and the rhinoceros beetle.

Livestock consists of pigs, poultry and goats. Attempts to improve the local swine stock have achieved some positive results. Exotic breeds have been interbred with local pigs to produce new bloodlines.

Ocean and lagoon fish and shellfish are available in quantity and form a staple constituent of the diet. A fish processing plant has been in operation on Atafu since 1990 with funding under the FFA/US Tuna Treaty. The facility processes fresh tuna into marinaded, sun-dried tuna jerky. Trochus stocks on Fakaofo have been replenished with specimens from Aitutaki in the Cook Islands. The project has also been extended to cover Nukunonu and Atafu. A UNDP/FAO aquaculture programme has approved a financial contribution towards the transplant of black pearl oysters from Manihiki in the Cook Islands to Tokelau.

Local timber, particularly Cordia subcordata, is used for canoe-making, houses and domestic utensils. There is no mineral extraction in Tokelau.

Copra production has declined considerably in recent years due to falling international requirements. Tokelauan handicraft, particularly woven items such as mats, hats, bags and fans, are renowned throughout the Pacific for their detail and close work. The office of Tokelau affairs in Apia maintains a collection and items periodically appear in other Pacific markets and collections.

Each village has co-operative stores run by village management committees. The public service administration works closely with these committees to improve management and to reduce the costs of goods arriving in Tokelau. Until recently all goods were obtained from wholesalers in Western Samoa and channelled through the Office of Tokelau Affairs in Apia but an increasing amount of goods is imported directly from manufacturers in New Zealand and Fiji.

TOURISM

There is no tourism to speak of except for the occasional passing yacht, and no established facilities for tourists.

INTERNATIONAL TRADE

There are very few possibilities for export revenue generation. Small amounts of copra are exported as well as handicraft, coins and stamps. Black pearls are to be introduced from the Cook Islands as a potential trade item.

The total revenue for the financial year 1991/92 was $6 million. Some internal revenue is derived from taxes on handicraft, shipping, copra, freight charges, the sale of postage stamps and coins, customs duties and service charges on remittances. Budget estimates are initially prepared by a special committee and then discussed by the general fono. If approved by the fono the budget is then passed to the minister of foreign affairs for final approval. There was a surplus of $784,688.

Tokelau's main source of development assistance continues to be the New Zealand bilateral aid programme. Direct budgetary assistance of $5.3 million in 1991/92 represented 65 per cent of the total New Zealand contribution to Tokelau's economy. This budgetary support is provided in the form of quarterly cash grants, in recognition of New Zealand's constitutional obligations.

The budget revenue does not include funds received from international agencies sponsoring specific projects. In 1991/92 projects were sponsored by a number of agencies including the UNDP, the SPC, UNESCO , UNICEF and the Forum Fisheries Agency. UNDP is the largest donor after New Zealand. The Commonwealth Fund for Technical Cooperation has been an important donor in the education sector, providing funds for awards of tenure outside New Zealand. Considerable funds were required for emergency and diaster relief in the 1991/92 period because of cyclone damage.

A considerable portion of other revenue comes from remittances to families from other family members living and working overseas.

New Zealand currency and the Tokelau souvenir coin are legal tender in Tokelau but Western Samoan currency is also used. The first Tokelau souvenir coin was minted in 1978 and four others have followed. In the absence of banking facilities, the Office of Tokelau Affairs provides a deposit and withdrawal facility, and pays interest on accounts.

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