Feeling the Pinch

Pacific islands reel from rising fuel costs
By Gemma Q. CasasVariety News Staff

PACIFIC lawmakers say the continuing rise in fuel cost is affecting their islands’ transportation, power supply and ability to pay for basic food supplies such as rice.Legislators from Guam, Chuuk, Yap, Pohnpei, Kosrae, Palau and Hawaii are here with their CNMI counterparts for the 25th general assembly of the Association of Pacific Island Legislatures. They said the value of the U.S. dollar continues to shrink as the price of fuel rises.
With the exception of Hawaii and Guam, which have strong tourism and military-based economies, the other islands now find it difficult to provide the basic needs for their residents. All of the islands get annual financial aid from the U.S. but the lawmakers said it was not enough to cushion the impact of skyrocketing fuel prices.
The APIL delegates agreed something must be done before the situation gets worse.

No more rice
In Chuuk, rice importers have yet to receive their latest delivery from China, Japan and Australia. “We have no more rice in Chuuk,” said Rep. Remigio Bualuay. He said the shipment has been delayed for several weeks now due to the rise in fuel prices which affects the shipping costs of imported goods. He said the rice shortage has resulted in higher prices, a further burden on residents who mostly earn $1.35 an hour — the minimum wage in the Federated States of Micronesia’s private sector. “They now sell a 50 lb. bag of rice for $27,” said Bualuay.
A gallon of gasoline in Chuuk sells for $3.90 — almost three times higher than the island’s minimum wage rate.
Lawmakers from Pohnpei, the state capital of FSM, said a gallon of regular gasoline sells for $3.90 on their island also. They said the situation is making it more difficult for residents to travel, especially since FSM is made up of scattered islands.
Palau Vice Speaker Okada Techitong said the high cost of fuel is slowly eating up their meager resources for public health. He added that a residents’ ability to avail themselves of electricity is also in danger. “It’s affecting all our services,” Techitong said, adding that some residents with no regular income may soon find themselves without power due to the high cost of fuel. In Palau, power is sold at a basic rate of 23 cents per kilowatt hour. But the rate goes as high as 40 cents per kwh with the fuel surcharge added to it. “We have no subsidy for power,” said Techitong. He said a gallon of fuel cost $3.29 as of last week in Palau. The minimum wage in Palau, like FSM, an independent nation freely associated with the U.S., is $2.50 per hour in the private sector and $3.95 per hour in the government sector.
Guam Vice Speaker Joanne Brown, the APIL president, said their island has not been spared from the impact of the constant rise in fuel costs either. “Certainly as a result of that we’re finding that the cost of living has risen dramatically. All of the islands in the region are affected by the rise in fuel costs,” she said. She said the rise in fuel costs has a multiplier effect on all consumer goods as well as services such as electricity. “Shipping costs are going up. The overall costs of all goods and commodities that we consume. Residents are seeing a substantial increase in their power bills and that’s a result of the rising fuel cost. We are very challenged with these issues,” she said.


The prices talked about in this article are typical of those here on island. Maybe only those who have lived in Asia can really understand the trauma of hearing the words "There is no more rice...." The people here eat rice for every meal (and snacks!). Meat and vegetables are almost relegated to condiments for everyday fare.

Here on Saipan (CNMI) the minimum wage is somewhat higher than in some of the other places, having been at $3.05 per hour since 1996. As of yesterday, unleaded gas is $3.46 per gal.
On top of all of this, these islands are often delayed in taking preventive or supportive actions by complicated red-tape procedures that are in place, I assume, to protect against corruption--yet another problem that plagues many of them.