With one of the world’s smallest populations in an isolated location, Niue relies heavily on New Zealand aid to combat a “brain drain”. The island nation’s premier has a dream of achieving self-sufficiency within five to 10 years – but can it be done? Sam Sachdeva reports from Niue.

Whatever your views of her politics, it’s hard to deny Jacinda Ardern’s talents with children.

She had the schoolkids of Niue eating out of the palm of her hand on Tuesday morning (NZT), fielding an array of questions with ease, including one on the difficulties of being a female politician – “I don’t feel the pressure to work harder than men, I just do.”

The coral atoll has a population of roughly 1700 people – 450 of whom are children in Niue’s education system, running from early childhood education all the way to Year 13.

But as Niue High School principal Charles Ioane pointed out to Ardern, there is a limit to what the island nation can do.

“For most of these students, they will in one way or another end up in New Zealand attending tertiary education.

“It is no secret that this has been detrimental to our population and ultimately our economic growth.”

Niue fights ‘brain drain’

That is Niue’s problem writ large, with the number of native Niueans dwarfed by the 24,000 making a life for themselves in New Zealand.

It is the highest-aided country in the world, with an official development assistance-to-GDP ratio of 80 percent and each Niuean resident receiving over US$8000 on average per year.

The bulk of that is provided by our Government, thanks to Niue’s status as a self-governing country in “free association” with New Zealand: the country’s people are New Zealand citizens, and the Kiwi dollar is the currency of choice.

But the “brain drain” from Niue is starting to turn around, thanks in part to New Zealand’s investments in its tourism industry.

“It’s not something that I see as being New Zealand’s money this year, next year and so on. I expect us to get a return from this, and I expect us to get a good return.”

Between 2010 and 2014, the tourism sector’s contribution to GDP jumped 240 percent, rising from $2.2 million to $5.3m.

Niue Premier Toke Talagi said his country’s success was also due to broader changes: in 2016, it hiked its pension and announced plans to lift public servants’ wages, while recently reforming its public services to make them run more like New Zealand state-owned enterprises.

“Part of the reasons why we have been successful in stopping migration from here and increasing the number of people who stay here is because of those factors: because we have made sure that when they do come, they all have good health, good education, and will be supported well by the community here.”

Talagi’s goal is for Niue to be self-sufficient within five to 10 years – a goal he readily admits is a lofty one.

“I’m an ambitious person, I’ve always been an ambitious person, I mean I used to run a business here and my objective was to earn a million dollars.”

That personal ambition failed, but he believes this one can succeed, in part by changing Niue’s relationship with New Zealand from one of aid to investment.

“It’s not something that I see as being New Zealand’s money this year, next year and so on. I expect us to get a return from this, and I expect us to get a good return.”

Niue Premier Sir Toke Talagi says New Zealand’s contributions to his country must become investment, rather than aid. Photo: Sam Sachdeva.

It’s a sentiment that would find favour with many on New Zealand’s side: a report on the Government’s aid to Niue, commissioned by MFAT in 2015, found a lack of strategic vision and “circular reasoning” in some goals.

“For example, under the governance priority, the goal is to ‘create more effective government to enable an increase in its [Niue’s] productivity and improve performance in the delivery of services’, and the indicator to measure this against is ‘an improvement in the efficiency and effectiveness of the public service’ – these are essentially the same thing.”

Of the report, Foreign Affairs Minister Winston Peters said: “We’ve read it, and we’ve taken notice.”

“We want to be development partners, treating people as equals, ensuring that they see there is a potential future because they’ve got not just us but Australia and other partners as well.”

Ardern said she was well aware of Niue’s struggles, likening it to New Zealand’s own battle with “the brain drain”.

“Every small island nation of course wants to make sure that they hold onto their young people, to their best and brightest – we’re certainly mindful of that.”

“The trend is slowly shifting: we steal this country back more and more in recent years, and the future is promising.”

She announced over $6m of new funding for Niue: $5m to help the country reach its goal of 80 percent renewable energy by 2025, and $750,000 to help improve its infrastructure as it faces the strain of a tourist boom.

There could yet be movement on the issue of pensions portability as well, making it easier for people from “realm countries” like Niue to return home without strict superannuation residency requirements.

Talagi raised the desirability of New Zealand’s pensions as an obstacle to keeping Niueans at home, and a change may be possible in the near future, with Ardern saying she was “sympathetic” to the issue.

“There’s certainly examples here in Niue of New Zealanders who have come here from New Zealand to Niue, lived here, worked here, and then felt a requirement to return home simply to meet the criteria for accessing pensions.”

The Niue premier’s goal of his country standing on its own two feet within a decade feels unlikely, to say the least. High Commissioner to Niue Ross Ardern – the Prime Minister’s father – said he believed self-sufficiency was “still some distance off”.

And the fact that Talagi did not bring up the issue of Niue gaining full UN member status with Ardern, having pushed the issue in 2016 only to receive warnings such a move would put the islanders’ New Zealand citizenship at risk, suggests he knows that independence can only go so far.

But Ioane sees cause for optimism, despite often feeling “like we are preparing our people for life in New Zealand”.

“The trend is slowly shifting: we steal this country back more and more in recent years, and the future is promising.”

Sam Sachdeva is Newsroom's national affairs editor, covering foreign affairs and trade, housing, and other issues of national significance.

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