Suva, Fiji - July 22, 2025
As prepared for delivery
Bula Vinaka! [Hello!] Warm greetings to everyone here today.
It’s a privilege to join you on behalf of the World Bank Group. I want to thank the Pacific Islands Forum Chair, Prime Minister Dr. ‘Aisake Vale Eke of the Kingdom of Tonga, and Pacific Islands Forum Secretary General Baron Waqa, for this opportunity to be here with you. I would also like to thank the Government of Fiji as hosts—Deputy Prime Minister Biman Prasad and I had a very productive exchange this morning. And to all Pacific leaders, and Finance and Economic Ministers present, thank you for your generosity and partnership with the World Bank Group.
Importantly, I also want to congratulate you on the clarity of your vision.
Because the Pacific is not waiting for the world to define its future. You have already done so through the 2050 Strategy for the Blue Pacific Continent and the Pacific Roadmap for Economic Development.
The 2050 Strategy is more than a plan. It is a promise to your people, to your children, to the region, and to the world. A promise of a resilient, secure, and prosperous Pacific, where every Pacific Islander can lead a free, healthy, and productive life.
It reflects your values, which I have been privileged to experience firsthand in my short time here: cooperation, equity, cultural identity, and connection to land and sea.
And it reflects your ambition to build economies that work for people, to create jobs and opportunities close to home, and to act collectively in the face of climate, economic, and geopolitical shocks.
This is a vision we are proud to support.
The World Bank Group is focused on doing our part by working regionally, bringing partners and the private sector to the table, and helping to unlock solutions at the speed this region deserves and at the scale these challenges demand.
This is how we see the World Bank’s role. We are not just a financier, but a partner. A partner who listens, who learns, who shares, and who works alongside Pacific countries to deliver results through a shared vision, collective action, and long-term commitment.
Because here is the truth: these are not small challenges.
And we are in a challenging global environment. Global growth is projected to fall to 2.3 percent in 2025, the slowest rate since 2008 apart from the COVID-19 pandemic. Growth in the 11 Pacific member countries of the World Bank, excluding PNG, is set to slow to 2.6 percent; with PNG included, growth in the region would be still modest 4.1 percent. While inflation has fallen, the total impact of high inflation in recent years has increased the cost of living in the Pacific by 15 to 30 percent since 2021. While some countries’ risk of debt distress has been lowered, six countries are still at high risk of debt distress.
And, of course, the structural challenges of the Pacific have not gone away. Trade is uniquely costly in the Pacific with access to only a few shipping lines. Climate impacts are accelerating. Jobs are scarce. Connectivity is uneven: mobile phone and internet coverage are well below world averages. And access to finance is too often out of reach for firms, especially micro, small and medium-sized enterprises.
You, of course, know these issues, and we very much appreciate the gravity of these challenges.
No single country or institution can solve these issues alone.
But when we come together, align our efforts, and act with purpose, we can deliver solutions that match the size of the task.
Today, I would like to share three areas where we are working with Pacific nations to deliver on our shared vision.
First, strengthening regional trade and financial links.
As you are all well aware, Pacific countries face the highest trade costs compared to the wider East Asia region: equivalent to an average of 210 percent of the value of the goods being traded. It is very difficult indeed for Pacific businesses to compete regionally or globally with these costs. Many Pacific countries also rely on narrow export bases and have limited connections to global markets. This makes them vulnerable when shocks hit, and it makes it harder to grow their economies and create jobs. International financial connections are also precarious; the number of corresponding banking relations in the Pacific has fallen by 60 percent in the last decade—twice the rate seen in the rest of the world.
How can Pacific countries maintain their economic links? We recommend removing barriers to trade and investment, especially in services, since many of your countries have large, tradable service sectors. It is encouraging that several countries are already updating their investment laws – in other words, you have started to ‘future-proof’ your economies.
We are working with you to accelerate reforms and deliver benefits by responding with region-wide solutions that bring coordination and scale.
Responding to your leaders’ request to President Banga last year, we are preparing the Pacific Trade Facilitation Project. This project, which supports the Pacific Islands Forum’s Regional Trade Facilitation Strategy, will reduce the time required for trading and increase the number of firms benefiting from improved trade facilitation by simplifying customs procedures and reducing red tape. This will increase competitiveness and cut costs for businesses across the region.
And, through the Correspondent Banking Project, launched last year, we are helping safeguard vital correspondent banking relations that keep trade, remittances, and investment flowing. We started with seven countries; Solomon Islands has recently joined, and more countries are interested in participating. We thank our partners for providing financing for interested countries that are not IDA-eligible or are not World Bank Group member countries.
The correspondent banking and planned trade facilitation work demonstrate our new way of working with scalable, open platforms. Any country can join. All can benefit from harmonization, shared systems, and increased private sector interest.
We know that we move farther when we move together – and only then can we create more opportunities for Pacific people.
Second, building resilience in the face of climate and crisis.
No region feels the effects of climate change or natural disaster vulnerability more directly than the Pacific. In fact, 10 countries in the Pacific are ranked among the top 30 countries in the world with the highest average annual losses relative to their economies due to disasters.
You see it in rising seas, in extreme weather, and in damage that can wipe out years of development in a matter of hours. For example, the direct damage from the earthquake in Vanuatu in December last year was equal to 17 percent of GDP.
How are Pacific countries building resilience? Further investing in resilient infrastructure and protecting human capital—for example, through well-targeted adaptive social safety nets will be essential. But this needs increased domestic revenue sources and well-targeted expenditure. The creation of the Pacific Resilience Facility, the first Pacific-owned, led, and designed climate fund dedicated to community resilience building, is a key step that you have taken to build resilience. As you know, the World Bank has committed to supporting this Facility through our sovereign reserves advisory and management services, once it is up and running, and to co-finance selected projects to bring them to scale.
Listening to our Pacific and other country partners, I am proud to say that the World Bank has expanded the tools and mechanisms in our inventory to respond to shocks.
Through the Crisis Preparedness and Response Toolkit, we have delivered fast, flexible financing when disaster strikes. This includes US$32 million in grants disbursed to Vanuatu within days of last December’s devastating earthquake.
Moreover, we are investing in resilient infrastructure, renewable energy, and climate-smart services.
Another good example is the Pacific Climate Resilient Transport Program, a US$339 million program, where we are strengthening transport systems across six countries. This regional initiative is helping countries construct lasting transport infrastructure, including 150 kilometers of roads, eight maritime sites, and one airport, benefiting about 45 percent of the population of these countries. It is also delivering planning tools like Vulnerability Assessments and Climate-Resilient Road Strategies to mainstream climate resilience into national transport policies. This work is not only building infrastructure for the future; it is connecting Pacific people to jobs, services, education, and to each other.
And this resilience means jobs, too. Construction, maintenance, and services in climate-smart sectors can provide stable and meaningful work for Pacific people.
Related to this, I am pleased to announce that we have revised our Procurement Framework to bring a sharper focus on jobs. From September 1, 2025, companies working on World Bank-funded projects must include a minimum total cost for local labor in international civil works contracts.
This brings me to the third area we are working on: Jobs and adapting to technological change.
We all know that development is not just about GDP. It is about health, education, connectivity, and jobs that bring dignity and stability.
How are Pacific countries creating more jobs? Too many small and medium enterprises cannot get the finance to invest. More reforms to improve access to finance, with mobile and digital services, will be important. On the labor side, Pacific countries have made real progress, but too much human potential still goes untapped. Many young people need greater opportunities to build the skills and careers they aspire to. Improving education and protecting human capital through expanding the social safety net is essential. Women remain underrepresented in the workforce; the gap in women’s labor force participation compared to men is 22 percent – compared to 15 percent elsewhere in East Asia. Expanding their participation could increase long-term GDP per capita by 22 percent. And in too many places, communities still face barriers to accessing the services that support healthy, productive lives.
During his visit last year, President Banga noted in his discussions with your leaders the silent emergency of non-communicable diseases (or NCDs) that is robbing the Pacific of talent through increased morbidity and early mortality. NCDs account for 59 to 66 percent of premature deaths among 15- to 49-year-olds in several countries, compared to the global average of 41 percent. In response, we are preparing the Pacific Healthy Islands Transformation Project. This bold regional initiative aims to transform how healthcare is delivered across the Pacific: not through isolated interventions, but through a shared approach that strengthens public health systems, expands access to essential services, and reduces dependence on costly overseas medical referrals, which cost nearly half of the health ministry budget of some Pacific countries while benefitting only a few.
By connecting countries like Fiji, Kiribati, Tuvalu, and Tonga, and anchoring support through regional institutions like the Pacific Community, which will reach additional countries, this project will bring scale to national challenges and benefit 2.5 million Pacific Islanders. It is designed to deliver better health outcomes, ease pressure on national budgets, and create new opportunities for jobs, training, and service delivery in the health sector. For example, it will include centers of excellence on particular specialties, with one center in each participating country as a regional resource. Through this project we expect to train sixteen thousand (16,000) health care workers across the Pacific.
Just as Pacific countries are coming together to deal with this regional NCD epidemic, we have combined efforts alongside partners like the Asian Development Bank, the OPEC Fund, the Pandemic Fund, and Australia so we can pool our resources to overcome these challenges in a coordinated and lasting manner. We are investing in digital connectivity and digital ID systems so more people can access finance, start businesses, and participate in emerging sectors—driven by rapid technological change. The Pacific cannot be left behind.
These are some of the ways we are putting job creation at the center. Whether through energy and infrastructure, agribusiness, tourism, education, or health, we are backing the sectors that have the potential to deliver employment and growth in the Pacific. The World Bank—that is IBRD and IDA, IFC, and MIGA—will work closely together to help create the foundations for job creation and use our equity, guarantee, and insurance instruments to crowd in more private investors.
That brings me to my final point: to support this, and to make our work fit-for-context, we are preparing a new Small States Strategy. It is tailored to the needs of countries like yours and will focus on three important areas that are relevant to Pacific countries. On job-creating growth, we will explore how we support hard and soft infrastructure to enable private sector growth and job creation, keeping in mind the dispersed geography, small markets, and the need for healthy, affordable diets and food security.
A more effective financing framework will focus on innovative instruments and risk management tools. And to enhance operational effectiveness, we want a differentiated approach that works better for you. This includes (i) moving our teams closer to you; (ii) working closely with the ADB under the new Full Mutual Reliance Framework to increase scale and cut transaction costs for you; (iii) expanding the use of aggregated procurement procedures; and (iv) focusing on building capacity.
In closing, what I see in the Pacific is a region with vast potential and a clear, united plan to unlock it.
The World Bank Group is committed to being your partner of choice. Not just in words, but in action.
We will work with you. We will learn from you. We will share practices from elsewhere. And we will help bring others—partners, financiers, and the private sector—alongside you.
Because when we row together, we can build a more connected, more resilient, and more prosperous Pacific. For this generation and the next.
Vinaka Vaka Levu! [Thank you very much!]
