Tonga

What is the Need and Extent of Poverty in Tonga?

Only 30% of Tongan women are employed and 40% of them are underemployed being engaged in subsistence farming, fishing and handicrafts. 23% of the population lives below the poverty line. Opportunities for salaried employment are scarce. 

SPBD Microfinance Ltd (Tonga) - Following the success of SPBD Samoa, SPBD successfully launched its first replication in the Kingdom of Tonga in 2009. SPBD Tonga has a similar mission and vision and is the leading provider of microenterprise development services for economically disadvantaged Tongan women. SPBD Tonga reached financial sustainability within 18 months of inception and has since disbursed US 21,000,000. To achieve this goal, SPBD Tonga will continue to expand outreach on existing island groups (Tongatapu, Vava’u, Ha’apai, Eua’) and will expand to the additional islands such that over 14 islands will be covered in the next 2-3 years. To support this planned growth, SPBD Tonga will raise new loans and grants. SPBD Tonga currently impacts more than 8,000 individuals or 48,000 families – almost 1/2 of the population.

About Tonga

Tonga went through a period of violent civil unrest in 2006 but has since then enjoyed political stability. GDP per capita is about USD 3,700. Remittances form 24% of GDP and 82% of households benefit from them.

GDP growth lies at 3.5% (2016). Labor force participation rate is at 63% which suggests significant levels of informal activity. About 40% of women are self-employed. Most low-income workers are active in subsistence farming, fishing and the production of cultural products.

Four private commercial banks are active in the country: BSP (Bank of South Pacific), ANZ, Malaysian Banking Finance (MBf Bank) and the Tonga Development Bank (TDB).

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^*Planet Ratings (A Global Microfinance Rating Agency) conducted a Smart GIRAFE Rating for SPBD Tonga. This is the first time SPBD has been rated by an International Rating agency. The ‘Planet Rating’ rating committee has granted SPBD Tonga the good investment grade of “B+” with a “Positive” trend. The asset quality is rated “A”. As you can see in the certificate attached, the Smart GIRAFE rating of SPBD Tonga ranks well into the first quartile when compared to all MFIs rated by Planet Rating since 2008. This is deemed a very good performance by Planet Rating. The rating report is available through the Planet Rating website.