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Countries and Regions Country Assistance Plans Document
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Country Assistance Plans - Samoa
II. Country Operational StrategyA. The COS19. The Government’s development strategy, first enunciated in A New Partnership: A Statement of Economic Strategy, 1996-97, has been reaffirmed in a Partnership for a Prosperous Society: A Statement of Economic Strategy 2000-2001. The first Strategy emphasized the need to maintain macroeconomic stability and called for private?sector led economic growth based on a “new partnership” between the government and the private sector involving extensive consultation. The strategy also entailed improving the efficiency and accountability of the public sector, improving the performance of public enterprises through privatization and corporatization, human resource development, tax and tariff reforms, and financial sector reforms. The Strategy released in 2000 continues the emphasis on macroeconomic stability, public sector efficiency, improved education and health standards, and a strong private sector. In regard to private sector development, special emphasis is given to achieving sustainable growth in agriculture, fisheries, and tourism, and to revitalizing the village economy as a means of ensuring a better distribution of the economic and social benefits of the growth process. 20. ADB’s strategy of assistance to Samoa is to support the Government’s reform measures, which are aimed at making the economy more private enterprise based and competitively structured. The Bank will continue to support public sector reform, liberalization of the financial sector, promotion of private sector-led growth, corporatizing and privatizing state-owned enterprises, improving the management of power and infrastructure facilities, and addressing inefficiencies in education, including skills development. ADB’s strategy in Samoa is considered to be sound and is being implemented satisfactorily. No strategic adjustments are therefore envisaged for Samoa during the current operational cycle. B. Progress in Implementation21. ADB has been assisting the Government’s economic reform program for a number of years through technical assistance to the Treasury Department for capacity building in macroeconomic analysis, planning and policy formulation. This TA is now in its fourth and final phase, and significant progress has been achieved in macroeconomic management. The government has successfully implemented a performance based budgetary system, and the TA is moving gradually to capacity building at the line ministries level. ADB has also supported the reform in the Financial Sector and privatization of public enterprises through the FSPL. Two loans were approved in 2000 to assist in the reform of the education sector and another for small business development. C. Poverty Partnership Agreement22. The vision expressed in the Partnership for a Prosperous Society: A Statement of Economic Strategy 2000-2001 aims at improving the quality of life for all Samoans. However, poverty is not mentioned in the SES, and there is no set of actions explicitly described as poverty-alleviating. This is because poverty is not seen, in the absolute sense, as a critical issue in the Samoan context. The community based socio-cultural system generally ensures that no one is completely destitute. However, the concept of relative poverty has applicability. Although it is difficult to make a rigorous assessment of the existing poverty situation considering the mix of traditional subsistence activities, modest cash income activities, and private remittances encountered in the traditional Samoan society, household income and expenditure data for 1972 and 1997 demonstrate an increasing inequality of income distribution. This is a common outcome in the early stages of development in market economies, and can change as growth becomes broader based and thus more inclusive. The Government of Samoa is seeking to facilitate the latter process through implementation of its current Strategy. In particular, high priority is given to greater access to education and health services, and to revitalization of the agriculture sector. The Government’s rural development program aims at improving infrastructure (power, transport, and communications) throughout the country, thereby creating opportunities for those living in rural areas. 23. Sustainable improvements in livelihoods are always threatened by Samoa’s vulnerability to external economic shocks and natural disasters, over which there is no control. The Commonwealth vulnerability index ranks Samoa in the group of countries characterized by high vulnerability. Soundly-based economic diversification may reduce the extent of aggregate export instability, and good economic management can prevent the translation of such instability into general macroeconomic instability. Measures can also be taken to improve preparedness for, and responses to, natural disasters. However, it must be acknowledged that cyclones like those experienced in 1990 and 1991 can, at least temporarily, derail the reform process and undermine the growth needed to improve living standards. 24. The Statistics Unit of the Samoan Treasury is tasked with the
production and dissemination of macroeconomic data, and works closely
with the Statistics Department in the production and analysis of socio-
economic data. The Unit, in conjunction with the Statistics Department
(SD), wishes to undertake a quality household income and expenditure
survey in 2001. The last survey was conducted in 1997, but was flawed by
sampling and non-sampling errors. The 2001 survey would generate the data
for a poverty analysis, and would also permit the improvement of the
national accounts and the refinement of the consumer price index. However,
SD lacks specialist knowledge on the designing and implementation of
household surveys for poverty analysis. A small-scale TA is intended to
provide the means of filling this expertise gap.
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