Growth in the tourism sectors of Samoa and three other Pacific Island economies will determine their recovery from the COVID-19 pandemic.

That is the projection of a report produced by The World Bank titled Pacific Economic Update: Recovering in the Midst of Uncertainty which was released early this week.

The 56-page report gave an update on the current economic status and outlook for the Federated States of Micronesia, Fiji, Kiribati, Marshall Islands, Nauru, Palau, Samoa, Solomon Islands, Tonga, Tuvalu and Vanuatu.

As for Fiji, Palau, Samoa, and Vanuatu, the report said these tourism-based economies can expect robust growth of 6.2 per cent this year. However, for Fiji, tourism arrivals in June this year surpassed the June 2019 arrivals data which the report says will see Fiji continuing to lead the region's recovery with strong growth.

For Samoa, the report gave a positive outlook, stating: "In Samoa, ongoing growth in the tourism sector and remittances are expected to provide spillovers to the rest of the economy, complemented by the resumption of capital investments and construction following the border reopening."

While further to the south, Vanuatu continues to struggle from the aftermath of the twin cyclones last year with its tourism and agriculture sectors among the most affected.

"In Vanuatu, the impact of twin cyclones on tourism and agriculture negatively affected the economy. Reconstruction will stimulate economic activity but growth is expected to remain modest in 2023 and accelerate over the medium-term."

The report said as for Palau, it had to revise its growth projections "significantly toward" for this year due to a "weaker-than-projected tourism recovery" as a result of a lack of direct flights from source countries, such as Japan and Korea. 

"Overall, tourism arrival is expected to reach pre-COVID-19 levels for most of the Pacific in 2023. Nonetheless, risks are substantial due to the uncertain economic outlook for Australia and New Zealand and are particularly high for Fiji, Samoa, and Vanuatu," stated the report.

As for economic output levels, the report stated most Pacific countries are projected to reach their pre-pandemic GDP [gross domestic product] by next year, except for Palau, Samoa and the Solomon Islands. The report said for tourism-dependent economies, how quickly their national border opened as well as the restoration of links to source markets was critical to their recovery.

"For tourism-based economies, the earlier the border reopening and connectivity to regional source markets, the faster the recovery.

"Country-specific factors also determine the recovery path. Fiji will reach pre-COVID-19 output levels by 2023, with Vanuatu reaching the milestone a year later due to the impact of the twin cyclones. 

"In Samoa, pre-pandemic GDP levels may not return until 2025 due to the spillovers from the 2019 measles outbreak, prolonged border closure and a relatively weaker tourism base prior to the pandemic."