Three per cent GDP growth for Samoa

THE Asian Development Bank says Samoa’s Real Gross Domestic Product is expected to grow by three to four per cent this year.

In its Asian Development Outlook 1999, the ADB said provided the economy was not subject to severe external shocks and the government was committed to effective, continuing economic reform, Samoa could achieve a three per cent sustainable growth rate each year.

It said such a growth rate “will permit an increase in average income of around two per cent annually, and will generate jobs for the 500 new entrants to the labour force each year.”

The outcome, however, depends on durable improvements in the agriculture sector, continued expansion in fisheries, and realising the potential for further manu

facturing and tourism development.

ADB says Samoa must enhance its attractiveness to foreign investors because the rate of investment was a crucial deter minant of the actual growth rate.

“Political and economic stability, tax and tariff reform, improved transport and com munications infrastructure, and the devel opment of the offshore financial services industry are all positive features,” it says.

The Bank added that while the relative strength of the tala may have a deterrent effect, the current complexities and delays

in the investment approval process were more important. It says it was encouraging that the simple and transparent Foreign Investment Act was in the pipeline.

“Together with arrangements for secure access to land, this will provide a legislative framework conducive to greater foreign investment flows. The latter would provide not only capital, but also management skills, technology, and training that would increase the productivity of the workforce,” it says.

A potential added benefit of tourism, it says, was that the related job creation and investment could be in rural areas, helping stem urban drift and attendant social prob lems. ■