I still remember the time when me and my wife went to Tahiti on a honeymoon several years ago. It was an absolutely enchanting trip and both of us fell in love with the place.
Following that visit and many beautiful memories, I have been paying special attention to news about the southern Pacific island.
Sadly, in recent years, the island of Tahiti and the French Polynesia to which it belongs have both run into economic difficulties, with the entire region witnessing its worst recession in decades.
To holidaymakers or newly married couples, Tahiti might be well known for its beautiful beaches and breathtaking landscapes, but to academics on international relations, Tahiti is probably best known for its “nuclear test economy”.
For centuries, Tahiti and the entire French Polynesia had remained a self-sufficient society that relied on agriculture and fishery. However, things began to change drastically when France started carrying out nuclear tests in the region in 1966, and since then the way of life of the Polynesians was never the same again
After the French Polynesia had been designated as a nuclear testing site by Paris, the French military began to build massive infrastructure and facilities there, particularly on Tahiti, the largest island of the French Polynesia.
The French authorities were paying the Tahitians and other Polynesians twice as much the average wage back in France to work on their construction sites and other facilities. As a result, the vast majority of the islanders stopped farming and fishing.
Meanwhile, the influx of French military personnel, nuclear technicians and their families into Tahiti had brought fundamental change to the structure of the local economy.
Many Tahitians who used to be farmers or fishermen soon became either maintenance workers in nuclear facilities or service staffers catering for the French.
In the meantime, European goods and daily commodities poured into Tahiti. As a result, agriculture and fishery on the island completely gave way to market economy and service industry.
In order to compensate for the environmental destruction and contamination brought by nuclear tests, the French government offered a huge amount of economic aid to the Polynesians, totaling more than US$1 billion per year.
Thanks to the French economic aid and mounting demand for goods and service of the French people stationed in Tahiti, the island underwent a remarkable economic boom between the mid-60s and 90s.
Unfortunately, when Paris, a signatory of the Comprehensive Nuclear Test Ban Treaty (CTBT), stopped its nuclear tests in the French Polynesia permanently and pulled out its military personnel in 1996, the entire region plunged into recession almost overnight.
In order to survive, the entire French Polynesia, including Tahiti, switched to tourism to support its economy which is now dominated by the service industry.
Numerous attempts by the Polynesian authorities over the years to revive agriculture and fishery to diversify its economy have failed; they now account for just three percent of its economic output.
However, tourism seems to be losing momentum in Tahiti in recent years, partly due to the global economic downturn, and partly due to the astoundingly high living costs there. In fact Tahiti is probably one of the most expensive places to live in across the globe. For example, a hamburger in a local McDonald’s can cost more than a hundred Hong Kong dollars.
The sluggish tourism in Tahiti has led to climbing unemployment rate on the island. In 2014, around 17,000 people in Tahiti were jobless, out of a total population of 280,000.
Last year, Paris agreed to provide extra US$200 million in financial aid for the French Polynesia over the next five years. However, it is nothing more than a quick fix. Unless the islands are able to find another growth engine, the economic outlook of Tahiti is anything but promising.
This article appeared in the Hong Kong Economic Journal on Sept. 23.
Translation by Alan Lee
[Chinese version 中文版]
– Contact us at [email protected]