The Basel Agency for Sustainable Energy (BASE) is planning for the development of a remittance-based finance vehicle in Fiji, Tonga and Vanuatu. It is hoped this will improve the climate resilience of the South Pacific islands for the future. The Swiss foundation for financial strategies and unlocking investment in climate change solutions has launched its project Remitresilience in the Pacific with the two international non-profit organizations of Oxfam in the Pacific and Convergence. BASE is also a partner of the UN environment program.
According to a report by BASE, Tonga is one of the most vulnerable countries in the world to the impacts of the changing climate. Its development has been severely hindered by tropical cyclones, sea-level rise compounding storm surges and droughts. Most recently, the violent eruption of the underwater Hunga Tonga-Hunga Ha’apai volcano on 15 January - likely the biggest recorded anywhere on the planet in over three decades - left thousands of people without homes and basic supplies. Large parts of Tonga were blanketed by a thick layer of smoke and ash, which impacted water and electricity supply as well as air quality. The incoming humanitarian aid from other countries has also now exposed Tonga to the first COVID-19 outbreak since the start of the pandemic, making the monetary needs more dire.
Because the volcanic eruption also wiped out the single fiber-optic cable that connected the islands with the rest of the world, emergency remittance from abroad was impossible in this time of greatest need. For this reason, BASE, Oxfam and Convergence are currently finalizing a feasibility study for the development of a remittance-based finance vehicle.
“Remittances play an indispensable role in times of emergency in Tonga,” explains Veronica Corno, Climate Finance Specialist at BASE. “Leveraging remittances in the upcoming months, and even years, will be central for Tonga to rise and rebuild in a sustainable and resilient manner.”
