Why are the SIDS so vulnerable?

Why are the SIDS so vulnerable?

By definition, the Small Island Developing States have relatively small populations. The lowest populations are in the Pacific region: the 20 Pacific SIDS average just over half a million people, and if Papua New Guinea is set aside, the mean falls to about 200,000. However, many islands are small in area, so population densities can be very high. Apart from Singapore, which is consistently a statistical outlier, the highest population densities is found in the Maldives.

In all regions, population growth is slowing: from about 2% in 1975-1980 to 1.3% over the period 2005 -2010; and it is projected to fall further [1]. In some island states, emigration has contributed significantly to a further decline. In Micronesia, population growth is negative, and in Polynesia the rate of increase falls from 1.6 to 0.6% when emigration is factored in. People emigrate for a variety of reasons, but it is reasonable to suppose that many people leave small islands because of the risk of natural disasters and economic vulnerability.

In general, life expectancy is increasing in the island states: rising from about 65 years in 1990 to over 70 years in 2013, and is projected to continue to increase over the next 20 years. This transition will change the age structure of SIDS populations: the fraction of the populations that is over 60 will gradually increase. These demographic changes have implications for the level of public services that will be required in the future, particularly in regard to health services: older populations are more vulnerable to the health impacts expected to result from climate change.

 SIDS and Social Development

The Human Development Indices of 35 SIDS are ranked in the table below.  Papua New Guinea, the Solomon Islands, Comoros, Haiti, and Guinea-Bissau have the lowest ranking among the SIDS.[2]

The Human Development Index is important because it reflects the level of government services provided to a country’s population. A lower index indicates that the majority of the population lack essential services related to healthcare and education. These factors have implications for the ability of a country’s population to cope with and to recover from shocks. The mean value for the world is 0.711. Fourteen of the SIDS shown in this table fall below the global mean.

Is the quality of life improving in the small island States? The Human Deveopment report shows the trend lines for the SIDS. All the countries show improvements in their human development indices except for two: for Belize and Timor Leste the trend is downwards.

SIDS and economic vulnerability

The UN Department of Economic and Social Affairs (UNDESA) has a methodology that enables that agency to assess and characterize the economic vulnerability of many of the poorer countries, including many of the SIDS.  The Economic Vulnerability Index, or EVI, captures the relative risk posed to a country’s development by exogenous shocks. The impact of these shocks depends on their magnitude and frequency, and also on the structural characteristics of the country concerned—which affect the degree to which it is exposed to such shocks and its capacity to withstand them, in other words its resilience.

Given the potentially huge economic impacts of climate change and the shocks of extreme weather, a country’s EVI index provides a useful metric of a country’s resilience to climate change impacts.

The EVI is composed of seven indicators:

  • Population size
  • Remoteness
  • Merchandise export concentration
  • Share of agriculture, forestry, and fisheries in GDP
  • Homelessness due to natural disasters
  • Instability of agricultural production
  • Instability of exports of goods and services

The first four indicators contribute to an Exposure index; the last three indicators are combined to give a Shock index. The Exposure index and the Shock index are combined in equal measure to give the Economic Vulnerability Index. The relevance of the seven indicators to climate change impact is summarized below.

Population: Larger countries are generally more resilient to shocks and have a more diversified economy because of economies of scale supported by a relatively large domestic market. Small size is often associated with a lack of structural diversification and a dependence on external markets. Smaller economies therefore have a higher exposure to natural shocks, and many small low-income countries are situated in regions that are prone to natural disasters. The size of a country’s population is therefore considered to be a major indicator of economic vulnerability.

Remoteness: A country’s location is a factor that has a bearing on exposure and resilience. Countries situated far from major world markets face a series of structural handicaps, such as high transportation costs and isolation, which makes them less able to respond to shocks in an effective way.  Countries isolated from main markets have difficulty in diversifying their economies.  Remoteness is a structural obstacle to trade and growth, and a possible source of vulnerability when shocks occur.  It is considered to be one of the main handicaps of many low-income small island states.

Merchandise export concentration: Export concentration generally increases a country’s exposure to trade shocks.

Share of agriculture, forestry and fisheries in GDP: A larger share of agriculture, forestry and fisheries in GDP implies a higher exposure to shocks both in relation to terms of trade and to natural disasters.

Homelessness due to natural disasters: The indicator provides information on the average share of the population that is displaced by natural disasters over a period of time.

Instability of agricultural production: This indicator measures the instability of agricultural production with respect to its trend line.  The trend value reflects factors which may be permanent in nature (such as the availability of arable land) as well as economic policies, while fluctuations around the trend may capture the occurrence of natural shocks and their impact on production.

Instability of exports of goods and services: For low-income countries, particularly those dependent on agricultural exports or tourism, instability of exports is a source of vulnerability.  It results from fluctuations in world demand and other reasons not necessarily associated with the domestic policy of the country concerned—such as climate change or changes in policies of major importing markets.

The Economic Vulnerability Indices for 33 SIDS are shown in the chart below which compares EVI values with the Less Developing Country mean value of 45.7.

The least vulnerable countries in this group are Barbados and the Dominican Republic; the most vulnerable islands are Kiribati, Suriname, Tuvalu, Tonga and Guinea-Bissau.

Almost half of the group, fifteen SIDS, have an EVI value above the LDC mean. In terms of regional values, the Pacific region has greater vulnerability.

Both the AIMS and Caribbean regions are just below the LDC mean EVI–measuring 44.0 and 42.3 respectively. The Pacific region has an EVI of 55.0: 20 percent higher than the LDC mean value. But many SIDS are missing from the data set; it is likely that more of the islands in the Pacific would be found to be economically vulnerable if the data were available.

 

[1] See the World Statistics Pocketbook 2017 edition.  Available at: https://unstats.un.org/unsd/publications/pocketbook/files/world-stats-pocketbook-2017.pdf

[2] See the UNDP’s Human Development Report. Available at http://report.hdr.undp.org/