Tonga Economy 2008

Economy - overview:
Tonga has a small, open, South Pacific island economy. It has a narrow export base in agricultural goods. Squash, coconuts, bananas, and vanilla beans are the main crops, and agricultural exports make up two-thirds of total exports. The country must import a high proportion of its food, mainly from New Zealand. The country remains dependent on external aid and remittances from Tongan communities overseas to offset its trade deficit. Tourism is the second-largest source of hard currency earnings following remittances. The government is emphasizing the development of the private sector, especially the encouragement of investment, and is committing increased funds for health and education. Tonga has a reasonably sound basic infrastructure and well-developed social services. High unemployment among the young, a continuing upturn in inflation, pressures for democratic reform, and rising civil service expenditures are major issues facing the government.

GDP (purchasing power parity):
$178.5 million (2004 est.)

GDP (official exchange rate):
$244 million (2005 est.)

GDP - real growth rate:
2.4% (2005 est.)

GDP - per capita (PPP):
$2,200 (2005 est.)

GDP - composition by sector:
agriculture: 23%
industry: 27%
services: 50% (FY03/04 est.)

Labor force:
33,910 (2003)

Labor force - by occupation:
agriculture: 65%
industry and services: 35% (1997 est.)

Unemployment rate:
13% (FY03/04 est.)

Population below poverty line:
24% (FY03/04)

Household income or consumption by percentage share:
lowest 10%: NA%
highest 10%: NA%

Inflation rate (consumer prices):
11.1% (2005 est.)

Budget:
revenues: $56.97 million
expenditures: $83.88 million (FY04/05)

Agriculture - products:
squash, coconuts, copra, bananas, vanilla beans, cocoa, coffee, ginger, black pepper; fish

Industries:
tourism, fishing

Industrial production growth rate:
1% (2003 est.)

Electricity - production:
35 million kWh (2005)

Electricity - consumption:
32.55 million kWh (2005)

Electricity - exports:
0 kWh (2005)

Electricity - imports:
0 kWh (2005)

Oil - production:
0 bbl/day (2005 est.)

Oil - consumption:
880 bbl/day (2005 est.)

Oil - exports:
0 bbl/day (2004)

Oil - imports:
842.3 bbl/day (2004)

Oil - proved reserves:
0 bbl (1 January 2006 est.)

natural gas - production:
0 cu m (2005 est.)

natural gas - consumption:
0 cu m (2005 est.)

natural gas - exports:
0 cu m (2005 est.)

natural gas - imports:
0 cu m (2005)

natural gas - proved reserves:
0 cu m (1 January 2006 est.)

Current account balance:
-$4.321 million (FY04/05)

Exports:
$22 million f.o.b. (2006)

Exports - commodities:
squash, fish, vanilla beans, root crops

Exports - partners:
US 39.7%, Japan 27.8%, NZ 8.2%, South Korea 7.6% (2006)

Imports:
$139 million f.o.b. (2006)

Imports - partners:
Fiji 30.3%, NZ 27.7%, US 8.2%, Australia 7.5%, France 5.7%, UK 4.7% (2006)

Economic aid - recipient:
$31.75 million (2005)

Reserves of foreign exchange and gold:
$40.83 million (yearend, FY04/05)

Debt - external:
$80.7 million (2004)

Market value of publicly traded shares:
$NA

Currency (code):
pa'anga (TOP)

Exchange rates:
pa'anga per US dollar - NA (2007), 2.0277 (2006), 1.96 (2005), 1.9716 (2004), 2.142 (2003)