Based on an average kumara price of 5.2d per lb in 1958.

In document Aid in an island microstate : the case of Niue (Page 85-88)

5. Surpluses on the current account were recorded in 1909, 1910, 1912, 1918, 1920, 1928, 1929 and 1937.

(000,8) S 3 b 0 ± I Q N 3 d X 3 >8S3nN3A3b 3 0 3 0 1 V A g u r e 4 -4 : N iu e : re ven ues and e x p e n d it u re s , 1 9 0 7 -1 9 7 3 (c o n s ta n t 1 9 6 5 values).

disruptions to shipping which caused a backlog in exports and a consequent backlog in export receipts. This was the position between 1918 and 1920. Thirdly, philatelic sales were underestim ated in 1937.

Evidence from the d a ta also suggests t h a t a t the onset of the Second World W ar the A dm inistration abandoned their policy of balance for the Niue budget. In 1938, there was an 80 per cent fall in revenue from the previous financial year, b u t expenditure was reduced by only 50 per cent. This created a large deficit in the current account and began the p a tte rn which has been dom inant ever since. Only in 1946 and 1947 has local revenue ever looked like m atching expenditure, primarily because philatelic revenues in these years were abnormally high a t 70 and 57 per cent of total revenue respectively.

To summarise, the p a tte rn s of comm odity tra d e and public finance reveal a transition from a condition of self-support before 1940 to a condition of dependence after 1940. A part from the statistical evidence of stagn atio n of the colonial export economy and increasing dependence on imports presented here, there are numerous references in the Niue literatu re to the changing economic s ta tu s of Niueans, the decline of village agriculture (Baker, 1951; Gerlach, 1953; Bissell, 1965; W right and van W esterndorp, 1965; van W esterndorp, 1961, 1964; Lucas, 1968) and their increasing aspirations and dependence on imported foods and goods (Sewell, 1951; Langley, 1953; McBean, 1962).

4.2 A C C O U N T IN G F O R T H E T R E N D S

W h a t were the forces behind the major macro-economic trends described in the preceding section? Two factors are relevant: the political situation in the world and on Niue during the 1940s and New Zealand financial contributions.

4.2.1 P o litic a l ch an ge in w orld and N iu e: th e 1940s

No one really knows why New Zealand abandoned its policy of balanced budgets for Niue in the 1940s but the Annual Report of 1947-48 records t h a t the A dm inistration had come to believe t h a t Niue could not be self-supporting in a modern world economy:

Considering the limited revenue derived from these exports and from other sources and the continual expenditure and development programmes under­ taken with the encouragement of the New Zealand governm ent Niue at her present rate of production cannot be self-supporting (NZPP 1948 A-3:35).

It is difficult to understand how the A dm inistration could have reached such a conclusion given Niue’s record of self-support before 1940. Two things seem to be relevant: New Zealand’s sup port for the self-determination of non-self-governing territories and conflict on Niue between the A dm inistration and the London Missionary Society (LMS).

New Zealand com m itted itself in the 1940s a t the United Nations and other international forums to support the m ovem ent of non-self-governing territories tow ards the goal of self-determination (Aikman and McEwen, 1965; Parsons, 1968; Quentin- Baxter, 1971). This support did not result in im m ediate adm in istrative or political policies on Niue bu t New Zealand did boost its financial assistance to Niue and instigate a program m e of capital works.

During the 1940s relations between the A dm inistration and the LMS were strained. In its endeavour to push ahead with economic development the Adm inistration insisted the Niueans should work ships on Sundays, their sab bath day. This caused a confrontation with the LMS and virtually the entire population who w'ere LMS adherents. In 1947 and 1948 the islanders refused to work Sundays.6 B an an a exports ceased completely in 1947 and only 1,008 cases were shipped in 1948 as against 9,346 in 1946 before the Sunday ban. Late in 1948 the A dm inistration accepted t h a t islanders would not work on Sundays and they withdrew their dem ands for Sunday work. With this conflict New Zealand realised t h a t more detailed a tte n tio n would have to be given to Niue and greater efforts a t co-operation with both the islanders and the LMS would have to be made. This may be seen in two steps taken by New Zealand. Firstly, expenditure by the A dm inistration was sharply increased in 1948 (Figure 4.4); and secondly, the subsidy from the New Zealand G overnm ent was boosted (Figure 4.5).

These measures, however, did not ease tension on the island and in 1950 the Adm inistration imposed a nightly curfew which restricted people to their homes from 9 p.m. to sunrise the following morning (Curfew Ordinance 1950). In 1952 the A dm inistration perm itted the Church of L atter Day Saints (LDS) to build a mission at Alofi. This was vehemently opposed by the LMS. The population petitioned the New Zealand Governm ent to remove the Resident Commissioner, Mr Larsen, from office. Thro ugho u t this period the A dm inistration also policed the Planting of Land Ordinance very strictly. T he conflict reached a climax in August 1953 when Larsen was murdered by three Niuean escaped prisoners. These events d e m o n stra te t h a t increased financial assistance and economic development alone did not succeed. New Zealand a tte m p te d a new' policy in Niue but failed to consult with Niueans and continued to patronise them.

4.2.2 N e w Z ea la n d fin a n c ia l c o n tr ib u tio n s

Every year during the colonial period except for the period 1935-1939 the New'

6. Even today permission from the Niue Cabinet is required for Sunday work. The only tim e

In document Aid in an island microstate : the case of Niue (Page 85-88)