As this issue went to press, Democrats of theHouse of Congress in the United States stopped short of approving a US$25 billion bailout package for the big three players of that country’s automobile industry.

Following the US$700 billion economic package and other sweeping measures like the takeover of the two mortgage giants Freddie Mac and Fannie May that went through with such urgency earlier on, the auto industry—long acknowledged as the backbone of the US economy—probably expected this far smaller package to go through as quickly; but that has not happened—at least not yet.

Some sort of a bailout package will have to go through sooner rather than later or else it will affect tens of millions of jobs, not just nationwide but also in many other countries around the world—both in the core manufacturing industry and the far larger auto ancillary sector—which will only worsen the worldwide economic crisis.

Over the last one hundred years, few things have catalysed and spurred economic growth not only in the United States but also in dozens of countries around the world as much as the automobile has.

The automobile and the roads, highways and motorways that both followed and beckoned it wherever it went ignited the spirit of enterprise and propelled the growth of towns, cities, businesses and industries like few other things have.

 

Across the decades the automobile became the very symbol of personal empowerment: the private motor car brought a sense of freedom to individuals to go where they wished and do whatever they wanted to do at their own convenience, and at a faster pace than ever before.

As such, an all important industry faces one of its worst crisis in the very country that it became popular in, another vastly different technological tool is revolutionising personal empowerment all across the globe, ironically more so in countries where automobiles are comparatively few and far between owing to reasons that vary from economic conditions to accessibility and remoteness, such as in the Pacific Islands.

Enter, the mobile phone. The rapid proliferation of the now ubiquitous mobile phone networks is what is driving these changes in these countries.

Late though, the islands governments were in ushering in a climate conducive to more affordable and extended services, they have eventually done what was necessary by commendably liberalising their telecommunication regimes and allowing competition in the past few years.

 

Mobile networks in the islands are growing so fast that an international telecommunications monitoring outfit said earlier this year that mobile telephones will outstrip landlines in less than a couple of years regionally—it will hardly come as a surprise if this happens even earlier.

 

Other far larger but infrastructure-deficient countries like India and China have already seen this happen.

The mobile phone offers the same sort of empowerment that the automobile did in the last century.

It gives the individual the freedom to communicate and conduct business cost effectively from wherever to wherever.

The lure of its empowering quality is so strong and powerful that it is no surprise that people are lapping them up at the rate they are.

The next decade and beyond undoubtedly belongs to the mobile phone.

In the near future, competition will ensure that services get better, cheaper and variegated. This will only serve to give greater impetus to the sense of empowerment in individuals.

Pacific businesses would do well at this stage to build future strategies around mobile phone technologies and the plethora of goodies that services like 3G have to offer.

Businesses have already begun reaping the benefits around the region. Vanuatu’s hotel industry association told me that their members’ communications costs were now up to a third lower than what they were before and that they were now able to stay connected with supply chains and their employees that greatly helped step up their efficiencies. This is only one instance—there will be many more.

And, of course, technology is now setting out to achieve what three decades of politics could not: almost seamless region-wide roaming will give a boost to Pacific islands regionalism like no political policy or agreement has ever done.

The least the governments can now do is to encourage the private sector to scale up these services offering not just voice roaming but also data roaming (mobile internet access) and the not too distant possibility of mobile commerce.

Nothing will unite and integrate the region better than that.

 

The full effects of the global financial downturn will not begin to hit home in the islands until early next year.

Two of the islands’ top revenue channels will be hit: tourism and remittances. The former obviously because it’s almost completely dependent on discretionary expenditure on which there will be no choice but to tighten up; the latter because of job losses that are already beginning to happen.

We can only hope that the situation won’t turn so bad that islanders living and working overseas would be forced to return to their home countries to wait out the crisis.

That will largely depend on what measures the larger economies come up with to counter the crisis in the next few weeks and the revival packages that individual countries implement to prevent large scale job losses as a result of entire companies going out of business.

However, the trillion-dollar revival package announced by China last month to stimulate its own economy by stepping up its infrastructure may be good news for at least some natural resource rich island countries like PNG and the Solomon Islands.

 

Their spectacular growth over the past few years has been largely due to the demand generated by the Asian giant’s blitzing growth rate and, of course, Australian investment in facilities and operations.

The Australian mining industry which has also seen the brakes mercilessly put on its runaway growth since the crisis began unfolding will be relieved at that announcement.

Though rates offered will be lower and profits squeezed, the wheels of industry will keep churning, albeit slowly. And that’s great news for the Melanesian bloc.

Meanwhile, the islands will have to go through a phase of belt tightening and would do well to fall back on time-tested strategies of self-sufficiency and living within means. Best wishes for an austere holiday season.