28 Oct 2008

Asian development bank says Pacific countries need programmes of structural reform

11:11 am on 28 October 2008

The Asian development bank says the current world financial crisis shows the need for Pacific countries to continue with programmes of structural reform.

The call comes in a new study, "Navigating the Global Storm", which says the impact may be lessened through sound economic management.

It says the key response should be to reinvigorate structural reform, including rural productivity, and transport, communication and basic public services.

Craig Sugden, an ADB economist, says Governments need to undertake public sector reform, to help fund infrastructure projects.

"That will both give them room in the budget, to spend on infrastructure, and it also increases their capacity to deliver results. Structural reform is an ongoing process, and it never ends. Just the impetus, the need for it is now even more pronounced than usual."

Craig Sugden says the region's banking system is fairly well insulated, although there may be a fall in the value of the region's offshore investments, and remittances are also likely to fall.