Economic Vulnerabilities and Livelihoods: Impact of COVID-19 in Fiji and Vanuatu

The COVID-19 pandemic crisis has pushed the global economy into a deep recession. It has adversely affected trade, tourism, commodity and financial markets, global value added and supply chains (goods or services), and economic growth. Although only Fiji and Papua New Guinea have recorded cases of infection, economic disruptions are likely to be especially severe in most of the Oceanic nations as the tourism sector makes up the largest proportion of gross domestic product (GDP), of direct and indirect employment, and of foreign exchange earnings. Since border closures and international travel restrictions have halted
tourism in Oceania, the economies of the small islands developing states (SIDS) have been impacted by a contraction in consumer and investor confidence, and associated global value
chains. Tourism sector development is one of the key strategies for economic growth established in Fiji and Vanuatu as a vital source of business, investment, employment, and entrepreneurial activities. These nations have mobilized the tourism industry as a key player to create prosperity for sustainable development. In considering the impact of COVID-19 on the tourism sector, this study analyses the relationship between tourism and economic growth outcomes on the supply and value chain, and the level of impact of economic vulnerabilities on the livelihoods of local communities in the formal and informal sectors. The findings provide wider implications for the sustainable development goals (SDGs) and tourism linkages and their developmental outcomes.