But awaits UN’s decision

Merita Hutch



By next year, Samoa should be graduating from Least Developed Country status.
But the Tuilaepa government has written to the United Nations to extend its LDC status.
It cited the devastating tsunami which hit parts of the country last year as a reason for the request.
The last time Samoa applied to stay in this list, the UN said natural disasters, cannot be avoided and if Samoa continues with this excuse, the country will never get out of the LDC status.
Samoa was supposed to have graduated from the LDC status a few years ago after a long and arduous recovery efforts as a result of two devastating cyclones that about destroyed the whole economy in the early 1990s. Also Cyclones Ofa and Val which hit the islands in a period of a year left Samoa financially crippled.
That was followed by the country’s main exporter taro destroyed by lega, a name given to the disease which literally wiped out Samoa’s main crop.
Samoa’s argument then which continued after a decade was the fact that...“every time Samoa faces any sort of natural disaster, it was sure to destroy its volatile economy”.
However, after more than 10 years of recovery from the cyclones, thanks to the efforts of donor countries and Samoans all over the world, and with the UN following the country’s economic growth in the past years, it was then decided that Samoa was ready to face the developing nations.

Samoa’s ready
Its economy was being hailed as a model economy in the region by donors. But the tsunami struck on September 29, 2009—another set back to the already troubled Samoa economy caused by the global financial crisis. This would take another few years to recover from.
Samoa then quickly went back to the UN with another request to have its LDC status extended until its recovery is realised.
But the UN has been silent since the request was lodged and it appears Samoa would be moving out of the listing for the poorest countries in the world.
“It’s good to get out of the LDC list,” says the Prime Minister, Tuilaepa Lupesoliai Sailele Malielegaoi.
“Samoa is ready to enter into the developing countries list.”
He stressed, however, that Samoa opted to stay in the list of LDCs because of the disaster which has put its economy into disarray and because there is more assistance offered to countries in this listing for rebuilding.
It’s clear the country’s economy is by far sound and secured—although the argument is that every other country in the region is facing similar setbacks.
Samoa has exceeded its 400 million tala benchmark set for foreign debts and the Ministry of Finance predicts this amount would continue to increase in the next two to three years.
Tuilaepa insists in Parliament that it wasn’t a matter of how much Samoa is borrowing from other countries but the country’s ability to pay back.
“No international bank is stupid enough to continue lending to a country that they know cannot repay its debts,” he told Parliament.
“It will be the future leaders of this country who will pay for this growing debt,” says Levaopolo Taatonu, an independent MP who continuously raises his concern over Samoa’s growing foreign debt.
“This country is going straight to hell,” he says.
A former MP for the ruling HRPP who is now a member of the Tautua Party, Palusalue Faapo II says the government is awaiting the results of next year’s general election, before springing  the country with another addition to the Value Added Goods and Services Tax (VAGST) which is already 15%.
Minister of Finance Niko Lee Hang says he doesn’t know where the MP was getting his information from. But there aren’t any plans for government to increase VAGST if they returned to power in next year’s elections.
“Perhaps that’s what the MP’s party plans to do if they win the next election,” he says.
Samoa’s main income are from tourism and remittances which continue to grow in a steady manner. A campaign to push agricultural growth within the country is also progressing but there’s no denying the cost of living is rising steadily as well.
The government has introduced a 9.7 percent increase in salaries for those labelled as middle income earners to ease burden of rising costs of goods.
Financial aid from neighbouring countries such as Australia and New Zealand and the UN Family continues as recovery work from the tsunami progresses into the final stages.
All this would no longer be part of Samoa’s outfit once it moves out of the LDC list.
How Samoa will manage its affairs when it graduates from LDC status isn’t quite clear. But the prime minister is optimistic and so are the officials in the trade and foreign affairs ministries.