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We simply just want to survive. We cannot survive while trying to sustain our respective Tongan community, if we are expected to subsidize Tonga’s frail economy. It is not our responsibility. That is the responsibility of Tonga’s government … We do not want to perpetuate the financial blunders of generations past and give, give, give our way to the unemployment line, the welfare line, to government housing or homelessness … As for the issue of identity, let me ask you this: why should we sustain the economy of a country that hasn’t made an effort to embrace our generation? … Tonga only wants our money, but not us.
— Richard Wolfgramm, email posted on Pacific Beat online, Radio Australia, February 18, 2005
This statement, from a member of the second generation of Tongans in the USA, eloquently captures the key issues to be addressed in this chapter. Richard Wolfgramm is the publisher of a bimonthly English-language magazine for Tongans, Ano Masima News, based in Salt Lake City, Utah. Although he has been relatively successful, he readily admits that he does not send remittances to Tonga, partly because he has no family there whom he feels obligated to support, but also because the demands of participating in his local Tongan community are high. His statement reflects the views of many second-generation Tongans in the diaspora: he does not feel responsible for supporting Tonga’s economy, he resents the burden such support placed on his parents’ generation, and he believes Tonga welcomes his financial contribution yet does not accept him as truly ‘Tongan’.
The reluctance of second-generation Tongans to shoulder the burden their parents have borne raises some serious questions about Tonga’s future economic situation that are only just beginning to be considered. Since they began migrating in significant numbers in the 1970s, Tongan migrants have bolstered Tonga’s economy, generating about half of its GDP each year. In 2002–03, for example, official remittances were about $T150 million (DFAT 2003: 2), or about $A114 million. This figure could be less than half of the actual total received in that year, because it does not include money and goods sent through informal channels (Brown and Foster 1995).
Tonga is among the Pacific nations that have been identified since the 1980s as MIRAB economies, based on Migration, Remittances, Aid and Bureaucracy. The acronym was developed originally by Bertram and Watters (1985) in relation to Pacific states linked to New Zealand and expanded to include other Pacific nations with similar economic situations (see also Bertram 1986; Bertram and Watters 1986). The MIRAB model posits that ‘transnational corporations of kin’ operate to maximise support from migrants to kin in the homeland, and that a continuing flow of new migrants contributes to the sustainability of remittance levels.
Like other MIRAB states, Tonga is a resource-poor nation unable to find sustainable alternative sources of income to remittances. While some members of the ruling elite in Tonga have managed to amass considerable wealth, the majority of the population survives on low wages, some subsistence production and the money and goods sent by family overseas. A range of factors such as transport costs, high tariffs, environmental factors and fluctuating markets have all contributed to the failure of many income-generating ventures attempted over the years. Even tourism, one of the mainstays of many small economies, has never been successful in Tonga, in part because of the close proximity of Fiji, a far cheaper and more tourist-oriented alternative. Aid is a significant income source, yet the amount received is dwarfed by the remittances sent by Tongans overseas.
The future of these remittances is the focus of this paper and of the research I am currently conducting into second-generation Tongan transnationalism. Here I argue that only a low level of economic support for Tonga is likely to be provided by the second and subsequent generations of Tongans in the diaspora, and that this has worrying implications for Tonga’s future economic and social stability.
There is now a substantial literature debating the MIRAB model (for recent discussions, see Bertram 1999; and Poirine 1998), and much of this work addresses the claim made by Bertram and Watters that aid and remittances ‘appear capable of continuous reproduction at least until the turn of the century’ (1985: 501). Some studies have supported this claim, citing sustained high levels of remittances while others have supported the ‘remittance decay hypothesis’, which posits that the longer migrants remain overseas the lower the level of their remittances (Brown and Foster 1995: 38). Thus far, the sustainability debate has centred almost entirely on first-generation migrants.
There also has been a focus on how remittances are being used, with a continuing debate about whether this is primarily for consumption or investment. This debate is concerned with whether remittances help or hinder economic development, and in recent years has included consideration of the changing nature of remittances, such as goods for resale at flea markets, for example (Brown and Connell 1993). In some cases, remittances are being replaced by informal trade, as with Tongans overseas sending goods for Tongan businesses, and receiving in return agricultural products to sell to niche markets of Islander communities. Again, the focus of such work has been on migrants rather than their children.
Closely tied to the issue of what uses are made of remittances is the question of why remittances are sent, and it is simplistic to assume that they are just altruistic gifts to kin and country. Remittances are also sent for personal investment, to maintain land rights, and to prepare for retirement, although in the latter case few elderly Tongans do in fact return to Tonga because their children and grandchildren are based overseas. If we look at these migrants’ reasons for remitting, it is obvious that few members of the second generation overseas are likely to have similar motives, so why would they remit?
Warnings that remittances and other ties to Tonga are likely to decline have been made since the mid-1980s, although they have been paid little heed. Professor Futa Helu, a Tongan academic, argued that overseas-born Tongans would not have ‘the same sentiments, the same attachment to the homefolks as their parents had’, and asserted that remittances would ‘dry up sooner or later’ (1985: 3). He concluded that ‘all in all, we can say that the Tongan economy is facing a bleak future. We cannot continue to put our faith in remittances and transfers from Tongans abroad’ (1985: 6; see also Finau 1993). This bleak future was outlined in detail by Campbell (1992: 71), who suggested that
[a]ny lessening in the level of remittances will cause an abrupt fall in Tongan imports rather than a further widening of the trade deficit. A reduced import level would have a seriously adverse effect on government revenue directly and lead to further losses from the consequential contraction of other activity, especially in construction. A reverse multiplier effect would cause many bankruptcies in the retail sector, the contraction of government services, and a declining standard of living that would force many people back into the subsistence economy, with increased pressure on land and kinship relationships. Political upheaval could be a further downstream effect.
Such warnings have been ignored by the Tongan Government, and by many outside analysts; for example, the ADB’s recent overview of Tonga’s economy stated simply that the medium-term trend would be that ‘remittances are expected to increase and to underpin private consumption as source economies grow’ (2005: 227). This ignores the very real possibility that those remittances will decline in the longer term and that this could constitute a substantial threat to Tonga’s economic future.