Tonga-EU cooperation

Developing the Vava'u islands

by Myfanwy van de Velde

EC-Tonga cooperation began in 1975 with the first Lomé Convention, soon after Tonga gained full independence in 1970. Grant aid totalling ECU 19.8m (Lomé I - Lomé IV) has been allocated to the country during its 20-year membership of the Convention.

Under Lomé I, funds were directed principally towards two main projects: the construction of the wharf at Neiafu, Vava'u, and funding for the Ministry of Works to procure road maintenance equipment and build schools, rural health centres and small wharves at Ha'apai and Vava'u. Remaining funds were used to finance studies involving dredging, trade promotion and designs for Vava'u and Faua fisheries harbours. The EIB also financed a line of credit of ECU 130 000, under Lomé I, to the Tonga Development Bank.

Lomé II funds focused on the fisheries sector, and on initiating works relating to the upgrading of the Vava'u airport. There were also projects in the fisheries sector, aimed at encouraging fishermen to undertake commercial fishing to meet local demand. To this end, the Faua Fisheries Harbour for small boats was built, and marketing and cold storage facilities were provided.

By the time Lomé III funds came on stream, Tonga had adopted a regional development approach with regard to its various island groups. The aim was to have a coherent development programme taking account of the specific constraints and potential of each. The Vava'u group of islands became identified as the focal area for the use of EC assistance, and Lomé III resources (ECU 6.5m in grants and ECU 0.5m in the form of risk capital to be managed by the EIB) as well as Lomé IV funds (ECU 6m and ECU 1 m respectively) have duly focused on its development.

Located in the north of the Kingdom, Vava'u is the second group of islands both in terms of population (16 000) and land area. With an abundance of natural resources, the group is thought to have greater potential for agriculture and tourism than other parts of the Kingdom. However, this potential was largely untapped at the time Lomé III was initiated. This was due to a variety of constraining factors including relatively low productivity, undeveloped marketing infrastructures, substantial import levels and poor distribution of utilities and other public services. One particular constraint preventing the development of tourism was limited access caused by a lack of transport infrastructures.

Two main projects aimed at addressing these problems have been implemented. The first, costing ECU 1.24m, involved completing the upgrading of the local airport at Lupepau'u (begun under Lomé II). In addition to runway improvements, a new terminal building was provided, complete with safety and navigational equipment. Passengers began using the new facilities in early 1995. The second project, entitled the 'Vava'u Development Programme', was allocated the sum of ECU 5m. This money is being used to pay for a series of activities including road upgrading, the provision of photovoltaic equipment for household energy needs and the supply of equipment for vocational training colleges. New buildings being funded include health clinics, a market and an agricultural quarantine building. The funds also cover the cost of establishing the Vava'u Development Unit as the monitoring and implementing agency for the programme.

The Programme continues under Lomé IV, with about 85% of programmable resources for Tonga (approximately ECU 5m) set aside for activities in the focal area. Funds will be directed towards developing the Neiafu urban area, in recognition of the need to upgrade access and services in the commercial centre of Vava'u. The projects envisaged include upgrading the town centre and urban roads, port improvements, and measures to increase the capacity and improve the distribution of piped and rain water to households. In addition, a multi-annual micro-projects programme will lead to the construction of jetties on the inhabited outer islands of Vava'u, thereby improving access to Neiafu which is the main centre of the archipelago.

In addition to the above grant aid, Tonga has received funds in the form of Stabex transfers for losses in export earnings in respect of coconut products, bananas and vanilla. It also received emergency aid in 1977, following an earthquake, and in 1982 following Hurricane Isaac.

EIB interventions have contributed to the share capital of the Tonga Development Bank and have increased the Bank's lending capacity to small and medium-sized enterprises.