Feds report decrease in 2019 exports of canned tuna and related products

Pago Pago, AMERICAN SAMOA — American Samoa’s estimated gross domestic product (GDP) decreased by 1.4% in 2019, according to data and information released last Friday by the Bureau of Economic Analysis (BEA) of the US Department of Commerce.

Responding to a request for comments or reaction to the 2019 GDP decline, ASG Commerce Department director Fuiavailiili Kenseli Lafaele points out that the two pillars sustaining the local economy — government expenditures and StarKist exports declined in 2019. Additionally, other determinants of the local economy — consumer spending, business inventories, (decline in) imports — cushioned the fall of the GDP.

“American Samoa needs to diversify its economic base,” Fuiavailiili said yesterday, noting that “ASG invested millions of dollars in the Hawaiki cable and there's excess capacity but its lifespan isn't infinite.”

“We need to monetize the broadband capacity we have now to diversify and develop/ grow a digital economy in the 21st century,” he said. “Otherwise, our two-pillared insular economy will yo-yo up and down — with spurts of growth fueled by natural or health disasters now and then — until kingdom comes.”

(Read Op-Ed on the same subject by Principal Investigator of the American Samoa Territorial Broadband Strategy and the American Samoa Territorial Planner, Michael McDonald in Monday’s Samoa News.)

In a national news release, BEA announced that the decline in real GDP for American Samoa reflected decreases in government spending, exports, and private fixed investment that were partly offset by an increase in consumer spending and inventory investment.

“Imports, which are a subtraction in the calculation of GDP, decreased,” said BEA, which develops the estimates for the US territories under the Statistical Improvement Program funded by the Office of Insular Affairs (OIA) of the U.S. Department of the Interior.

According to BEA, government spending decreased 8.8% and this “decrease primarily reflected a decline in territorial government spending following the completion in 2018 of a multimillion-dollar telecommunications construction project.”

Based on BEA data and report by a federal official on island in August of last year, Samoa News reported at the time that the GDP for 2018 increased to 2.2% following a decline in 2017.

Regarding the 2019 GDP, the BEA said exports decreased 4.7%, primarily reflecting a decrease in exports of canned tuna and related products.

Additionally, private fixed investment decreased 22.7% and the decrease reflected declines in construction activity and purchases of equipment following the completion in the prior year of reconstruction activities associated with Tropical Cyclone Gita.

According to BEA, consumer spending increased 3.0%. “This reflected growth in services that was largely driven by purchases of health care services,” said BEA, and explained that health care services included those directly financed by government social benefits such as Medicaid.

Furthermore, the federal government's Additional Supplemental Appropriations for Disaster Relief Act of 2019 provided American Samoa with additional federal Medicaid funding.

Also released last Friday by BEA, are estimates of GDP by industry and compensation by industry for 2018. BEA said that the estimates of GDP by industry for American Samoa show that the private sector was the source of economic growth in 2018.

The growth in the private sector reflected an increase in manufacturing output of the cannery industry. Output of nonmanufacturing industries, such as construction and related professional services, also increased, reflecting post-cyclone recovery activities. The government sector declined, primarily reflecting a decrease in territorial government compensation.

BEA said the information provided by the American Samoa Government will continue to be critical to the successful production of these estimates. BEA currently plans to release GDP estimates for 2020 for all territories beginning in the summer of 2021. GDP by industry and compensation by industry estimates for 2019 will be released at the same time.

(More specific information and data on American Samoa GDP 2019 on www.bea.gov)