The Effects of Preferential Trade Agreements on Foreign Direct Investment: Evidence from the African Caribbean Pacific Region

In this paper we add to a relatively small literature on FDI in the ACP group by focusing on the role of PTAs in attracting FDI. Our empirical analysis utilises panel data on bilateral FDI stocks from 34 OECD countries into 45 ACP countries over the period 2000-2012. This bilateral specification allows us to control for country pair policy variables such as the presence of a PTA, a double tax treaty or a bilateral investment treaty between the OECD source and ACP host country, along with other important explanatory variables identified in the literature. We conclude the prevalence of market seeking FDI in the ACP group, with an important role for regional integration in providing access to surrounding market potential. Aggregation of countries in our sample masks regional differences. We find that in the Caribbean a PTA, with or without investment provisions, has no significant effect on FDI, regardless of whether a BIT is in place. In Africa, however, we find that a bilateral PTA with investment provisions, with or without a BIT, reduces FDI; and a bilateral PTA without investment provisions does the same, unless a bilateral BIT is in place, in which case FDI increases. This reinforces a view that the investment provisions in a BIT and a PTA are somehow aimed at different types of investments

Economic Insights on Environmental Accounts of the Pacific

This article is among the pioneering attempts to develop official statistics on environment-economic accounts in the Pacific Islands Countries (PICs). It discusses region’s challenges both in terms of statistical development and in use of environment assets. Special attention is drawn to significant rates of growth in inefficacies and wastages, which point to developing better physical infrastructure and management practices. The study also highlights important capacity development needs for the regional NSOs, especially in relation to environment accounts which needs urgency attention

Lessons for developing social security schemes for small island economies of the pacific region and beyond: some useful insights from Fiji's COVID-19 experience

COVID-19 has triggered deep economic damages and devastated livelihoods to an extent never experienced before. It has revealed several socio-economic vulnerabilities and can be used as a learning platform to prepare for future shocks. In particular, it has exposed the vulnerability of households to sudden, severe, and prolonged income shock, the significance of social security as a shock response tool, and the importance of household resilience for macroeconomic stability. This study uses the pandemic as an opportunity to understand the resilience of Fijian households to profound and prolonged income shocks, given their social, cultural, and economic setting. It evaluates the national response strategies, household coping mechanisms and the gaps in the current social security measures. The evaluation reveals several key lessons for a systematic response to any future shocks. The lessons are beneficial not only for Fiji but also for other similar economies in the region. Policymakers can build on the operational learning and capacity developed during the pandemic, reinforce the existing social security system and be better prepared for future income shocks. Fiji and other Pacific Island economies are highly vulnerable to climate related risks and have endured the adverse economic effects of some extremely intense natural disasters. It is important for these economies to strengthen household resilience and develop sustainable and broad based programs to social protection

Should credit unions in Fiji be externally supervised?

As financial markets have become more sophisticated, the frame-work to regulate and supervise their operations has commensu-rately changed. Credit unions have now begun to receive closer at-tention, given their important role in facilitating economic growth by mobilizing savings for productive use. Although they comprise a small proportion of the financial sector’s total assets and are presumed not to be involved in sophisticated financial instruments and therefore risks, they do serve a large number of small deposi-tors and are exposed to a number of financial and operational risks. The credit union sector in Fiji, though functional for long, has not been subject to external supervision. This paper reviews the operational process of credit unions in Fiji and discusses whether the current status of the industry warrants external super-vision

Exploring the role of tourism dependency on Covid-19 induced economic shock in the Small Island Developing States

All countries have suffered significant economic losses due to COVID-19 but some are affected more than others. A number of vulnerabilities explain the magnitude and differences in the economic shocks felt worldwide. This paper uses Ordinary Least Squares regression techniques to estimate the role of tourism dependency in explaining the differences in the COVID-19 induced economic shock in a sample of Small Island Developing States. The model also includes remittances, natural resource dependency, government debt and a measure of the quality of governance. The results confirm tourism dependency plays a significant role in explaining the cross-country differences in economic shocks. The economies that are more dependent on tourism have suffered larger economic shocks but remittances and natural resources have mitigated the negative impacts. The differences in the quality of governance also matter but debt levels do not explain the cross-country variations in the economic shocks. Hence, these fragile and small island economies need to develop appropriate economic diversification strategies, strengthen traditional economic activities and adapt new strategies, products and innovative business models for their tourism industry as the pandemic recedes and global travel resumes

Modelling tourism demand in Fiji

Being the major foreign exchange earner and a major source of job creation for Fiji, tourism is without a doubt an important industry for Fiji. Given the importance of the industry, the aim of the paper is to model the demand for tourism in Fiji. Cointegration and error correction techniques were used to construct a tourism demand model for Fiji. Both the long-run and short-run results indicate that income of our major trading partners is positively related with tourism demand. Contrary to expectations, relative prices were found to have a positive relationship with tourism demand. Unsurprisingly, coups are a major deterrent to the demand for tourism. However, major cyclones were not significant in explaining tourism demand

Treatments used in complementary and alternative medicine

In a cross-sectional study of the use of complementary and alternative medicine in 682 participants with HIV infection among the 47% ever-users, vitamins/minerals (81%), meditation/yoga (36%), massage (31%), marijuana (30%), dietary supplements (24%), and herbal medicines (19%) we the most commonly used. Users were most likely to be poorly educated, more likely to be unemployed, more likely to have been taking antiretroviral drugs for longer, and more likely to have objective, action-requiring adverse effects