be secured for a conducive investment climate. e. promoting micro, small and medium enterprises ( smes ) so that economic growth is more balanced and broad based. 9. summary • pacific island countries continue to grow, but we need to lift growth into the future. • private sector development will be key to raising our growth. • we also need to raise investment and productivity. • macroeconomic stability has to be maintained in order for growth to be sustainable. there is room for micro, small and medium enterprise development.

trading barriers and forced small nations to compete for a market for their goods and services internationally. • weather and environment problems, beyond our control, hinder economic performances as disaster recoveries are costly. rising sea levels, a result of global pollution, is a major issue that are already forcing islanders from their homes. • capacity constraints in pacific islands include a lack of skills and resources, necessary for economic development. the migration of skilled workers, exacerbate these problems. • political stability is required to ensure an environment conducive for investment. 5. what is the single major challenge for pacific islands? • pacific islands need to lift their economic growth levels. • growth must be sustainable and inclusive driven by private sector investment. • long - term sustainable growth is the only way to create jobs, improve living standards and reduce poverty. • millennium developments goals must be pursued actively. 6. how can we raise growth sustainably? • private sector development is needed to become the engine for growth. there is currently too much reliance on governments for direct investment and employment creation. • private sector development can give our small island economies the sustainable platform that we need. • such development can also in the long term ease the burden on governments. • private sector development continues to be a challenge because of good governance issues, uncertainty of policy consistency by the government, poor infrastructure and the need for law and order. 7. role of the state • the role of state is to create an environment that encourages private sector development through appropriate policies, services and infrastructure. • they are responsible for the provision of public goods and social services. • “ the best government is the least government ”. it is ideal when employment is created by the private sector, not governments. 8. lesson from asia – what else is needed? • investment is the greatest hurdle. raising investment by seeking out its impediments and removing them. to reach the average level of investment of developing countries, that is, 25 percent of gdp, fiji needs an additional $ 400m in investment. • economic growth cannot be lifted sustainably without reforms. the benefits of reforms include improved delivery of service, better allocation of resources and reduced tax payers ’ burden. • a few challenges remain for fiji given its smallness and vulnerability. a. improving our exports level and base through diversification b. improve our competitiveness through greater capacity utilisation and resource allocation c. raising our productivity in order to improve our competitiveness d. political stability has to