Countries and Regions

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Country Strategy and Program Update 2002-2004: Cook Islands : II. Implementation of the Country Strategy and Program

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B. Thematic Priorities

1. Economic Growth

25. The preparation of a new Cook Islands economic report assisted by ADB TA (one of ADB's Pacific Island Economic Report series) in mid-2001 will assist the Government and its development partners to identify opportunities for economic growth, and identify the policy and institutional frameworks that are necessary to ensure sustainability. The Government is giving priority to stimulating economic growth in the outer islands.

26. ADB will provide TA for Capacity Building in Island Councils, particularly with regard to the maintenance of assets. Through TA for regulating and managing utilities, ADB will assist the Government to prepare institutional and policy changes that will ensure efficient O & M of infrastructure through the increased participation of the private sector.

2. Human Development

27. The ADB-financed Education Development Project is being concluded in 2001; the loan has been fully disbursed. A proposed waste management project, for approval in 2001, will assist human development as well as environmental protection.

3. Gender and Development

28. Women play an important role in Cook Islands society. While they are underrepresented in parliament, they are important traditional leaders and are leaders in Nongovernment Organizations. Women also play a significant role at the managerial level in the commercial sector and in government departments. The CSP is gender-neutral in that benefits will accrue to males and females alike.

4. Good Governance

29. Improvements in Government have increased significantly during the economic restructuring that commenced in 1996. Decentralization of administration of the outer islands is gradually enabling outer islanders to assume more responsibility and accountability over time. The challenge to the Government is to ensure that the process is both equitable and fiscally neutral. The 2000-2001 Budget Policy Statement indicates a commitment to responsible government, which will be of particular concern until the country's significant debt servicing obligations can be reduced. Subject to debt management requirements, the challenge will be to restore equitable levels of social investment to pre-1995 crisis levels.

30. An important factor in achieving political stability has been a transformation of the decision-making process, under which all members of the Government's caucus are drawn into the Cabinet. Broad participation has allowed free-flow exchange and has promoted open government based on increased awareness of key issues.

31. The Government is committed to the following measures.

1. Establishing a commerce commission and banking authority, to uphold legislation that enforces fair trading, promotes competition, provides protection from predatory behavior, and monitors banking services.
2. Expanding the capacity of the Office of the Offshore Financial Services Commissioner to manage added responsibilities, including establishing a financial intelligence unit, and international cooperation on global taxation issues.
3. Implementing a job-sizing regime to restore relativity into Government service remuneration levels by establishing and implementing a remuneration structure linked to job size, responsibilities, and performance.
4. Concentrating attention on acquiring United Nations membership and full membership of the Commonwealth in the medium term. The Government will continue to strengthen relations with partners in the international community.

32. ADB is to assist the Government to strengthen ministries' accountability through improved policies, procedures, and reporting, and by providing additional training, through TA for improving corporate management in government services. TA for capacity building in islands councils, will focus on maintenance of assets.

5. Private Sector Development

33. The Government will continue to develop clear guidelines and a framework for managing assets and handing back Crown lands to landowners. The management of important utilities will be based on the private sector's right to operate, with ownership of the assets remaining in public hands. The private sector will operate facilities created under the proposed Waste Management Project.

34. The Government's responsiveness to local businesses on issues important for continued private sector development is to be improved. The business sector indicated that it has been able to better participate in decision - making.

35. The role of the Small Business Centre to support enterprises and communities in the outer islands will be expanded by providing assistance with business plans and meeting the requirements of the Outer Islands Development Grant Fund.³

6. Environmental Protection

36. Pressure on the natural environment of the Cook Islands is reaching levels that are likely to adversely impact economic growth. The environment is relatively fragile and is being severely tested by coastal erosion, the impact of development growth, and susceptibility to climate change. Conservation of the natural environment is essential for the sustained development of tourism, and is important for the protection of its marine resources.

37. The Environment Service is to undertake further efforts to provide an appropriate legislative framework for environmental management throughout the Cook Islands. The Service will institute environmental impact assessments as a routine procedure and continue to promote public awareness of environmental issues.

38. ADB is assisting the Government to conserve the natural environments of Rarotonga and Aitutaki through a loan for a Waste Management Project, which will incorporate capacity building in waste management. TA to build the capacity for environmental monitoring and regulation, and promoting community participation is proposed to assist the Government to expand its environmental management capabilities.

7. Regional Cooperation

39. The Cook Islands continues to demonstrate a strong commitment to regional development. It is a member of several Pacific regional bodies, of which the Pacific Islands Forum is one of the most prominent. The forum's economic ministers held their annual meeting in Rarotonga in June 2001. During a subsequent Consultative Group Meeting, chaired jointly by the Government and ADB, the Government announced its intention to seek membership in the International Monetary Fund and the World Bank.

40. The Cook Islands is also actively participating in several ADB-financed regional initiatives. They include initiatives against anti-money laundering, the use of traditional environmental management measures, and performance benchmarking for Pacific power and water utilities.

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