Summary & Key Findings: Pacific Economic Update - Pacific Jobs Pathway

Overview & Synopsis

Pacific Island countries are entering the rest of the decade in a still-turbulent world— marked by recurrent global shocks and heightened uncertainty. A succession of shocks since 2000—most recently the Middle East conflict’s global spillovers—underscores that turbulence has become the new normal, with shocks transmitting rapidly to small island economies acutely exposed to forces far beyond their control. Yet, the PIC-11 currently have a narrow but meaningful opportunity to reshape their growth path. In a rapidly aging EAP region, the PIC-11’s younger demographic profile stands out as a rare advantage. Resilience today requires not only managing shocks, but also enabling young people to participate productively and build income over time, strengthening the foundations of future growth. That strength is realized only when more young people are engaged in productive activities and move up the earnings ladder, which requires a fundamental shift in how growth is generated and supported. Accordingly, this PEU refocuses from cyclical fixes to people-centered policies and institutional changes that raise productivity and expand opportunity, so demographic potential is converted into more and better jobs and rising incomes, providing a critical buffer against persistent and compounding external shocks, even as external turbulence persists