Mosese Raqio 
[Photo: FILE]
Pacific nations are being warned that surging global fuel prices, escalating Middle East tensions and worsening climate pressures are tightening government finances and pushing up the cost of living across the region, with growth expected to slow further.
Speaking at the Pacific Financial Technical Assistance Centre meeting, Minister for Finance Esrom Immanuel says the Pacific remains one of the world’s most strategically significant yet climate-vulnerable regions.
Immanuel says the region’s policy choices carry weight well beyond its shores, particularly as countries continue to grapple with energy and commodity price shocks, rising living costs and mounting fiscal pressures.
The Minister says regional growth has softened to around 3.4 percent in 2025, and is expected to moderate further.
“For import-dependent economies like ours, these prices are straining household budgets, limiting fiscal space, and constraining our ability to invest in future development.”
He says escalating tensions in the Middle East and disruptions to global oil supply chains have intensified the challenges facing Pacific nations.
“The energy crisis is also placing significant pressure on tourism-dependent economies across the region. Higher aviation fuel costs are increasing airfares and travelling expenses.”
Meanwhile, Pacific Islands Division Asia Pacific Department Division Chief Alasdair Scott says technical assistance and policy support remain critical as Pacific countries face rising economic strain.
Scott says the latest global oil shocks are expected to further pressure Pacific economies heavily reliant on fuel for transport and electricity generation.
