The World Bank has released the Tonga Poverty and Equity Assessment, a report that examines poverty and inequality trends in Tonga from 2015 to 2021. The assessment, based on Household Income and Expenditure Surveys, provides insights into monetary poverty changes and offers future recommendations.
Despite challenges such as cyclones, the COVID-19 pandemic, and a volcanic eruption in 2022, Tonga managed to reduce its poverty headcount from 27.4 percent in 2015 to 20.6 percent in 2021. Inequality also decreased; however, rural areas still experience higher poverty rates than urban ones.
“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,” said Stefano Mocci, World Bank Resident Representative for the South Pacific. “Investing in education and health along with creating more job opportunities will be critical to Tonga’s success moving forward. This report offers a vital roadmap to help the country navigate its challenges and build a more resilient and inclusive future for all Tongans.”
Remittances have significantly contributed to reducing poverty in Tonga. In 2021, almost 90 percent of households received remittances accounting for 45 percent of GDP. While acknowledging their importance, the report highlights the need for income diversification and managing reliance on temporary labor migration programs due to potential labor shortages and social impacts.
The report shows improved living standards between 2015 and 2021. Households owning essential assets like cars increased from 37 percent to 55 percent; mobile phone ownership rose from 82 percent to 97 percent. Access to basic services improved as well, with flush toilet access rising from 82 percent in 2015 to 90 percent by 2021. Nonetheless, significant gaps remain between rural and urban areas regarding service access and economic opportunities.
Strengthening social protection systems is emphasized in the report, ensuring they can quickly respond during crises such as natural disasters by prioritizing vulnerable groups like women, seniors, and people with disabilities. Given Tonga's vulnerability to frequent shocks, robust safety nets are crucial for preventing households from reverting into poverty.
Additionally, improving education and job training is necessary for enabling Tongans access better-paying jobs domestically or abroad. Vocational training alongside digital literacy investments will aid Tongans entering high-growth sectors like tourism.