The whole region faces numerous challenges, such as food shortages, rising sea levels, and environmental degradation. For example, Nauru used to be one of the richest countries in the region, but by over mining of phosphate to the point of depletion, it gradually eroded away the jobs and money from the people. There are many challenges in the area, but vulnerability is one of the general characteristics of the SPR, followed by poor leadership, corruption, inter-communal confrontation, HIV, and ill-managed land use. However, she mentioned that in SPR, the land is used by the community as a whole and not by any particular individual.
Lack of human resources and arable land have made matters worse for the SPR countries. People in these regions think that the more they import goods, the greater their social status. Most of the people want to work for the government, which makes matters worse, because many governments are not capable of employing that many people, as currently most of the money the government spends is already being spent on government worker’s salaries.
Other reasons include the geographical location of SPR. It is very far from large land massed countries, which makes the transportation costs of goods to and from the SPR nations very high. Rising population and rapid urbanization have put extra pressure on the limited resources available, as well as the emigration of people from SPR nations to other regions that have no savings or money of their own.
With all of the current problems in SPR countries, more developed economies are needed to be relied on in the form of aid. Australia is highest aid donor country to the SPR. Following which, we need to answer the question, why Foreign Aid is vital to the region? It is because of the narrow resource base and production conditions in the SPR. Even the traditional handicrafts that get exported have a very low market price, and SPR countries have failed to adopt newer methods to compete on the world market.
Questions arise as to why countries are giving aid to SPR countries. One of the reasons is the security threat. This is also known as the “Pacific Doctrine”, or any kind of religion or ethnic clan based violence which might reach the peripheries of the countries. Australia and New Zealand nations call this SPR an “Arc of Instability” because of constant coups and clashes based on ethnicity.
The SPR lost its significance in the post-Cold War period due to constant infighting and most of the aid money getting lost in mismanagement. It is also due to aid countries facing “aid fatigue”, meaning the donor countries are unsatisfied about where and how the money is used. Most of the aid money goes into giving salary to government employees, education, and infrastructure.
At the end of her speech Prof. Baiq answered the questions raised by the audience too.