Pacific Islanders Forced to Tighten Belts as Inflation Soars

Inflation hit over 8% in Tonga and 10% in 2022, forcing residents like Fononga Pulu to cut back on foods like fish and yam. Families are finding alternatives and having to budget carefully.

Samoa, Vanuatu, and other tourism-dependent economies also saw high inflation around 8% in 2023. Imported inflation and domestic factors like disasters have driven prices up.

Governments have responded with tax exemptions, spending measures, and price controls. But support should be better targeted at those most vulnerable.

Inflation is declining across Asia more broadly. Indonesia, Malaysia, and others have used price controls and subsidies to shield people from high prices.

Support needs to be carefully withdrawn as inflation falls. But risks remain, so it's too early to declare victory over high inflation.