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Modelling the impact of COVID-19 in small pacific island countries

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  • Nikeel Nishkar Kumar
  • Arvind Patel

Abstract

This paper studies the economic impact of COVID-19 in Fiji, Tonga, and Vanuatu. The UNWTO’s International Tourism 2020 Scenarios and the World Bank’s projected decline in remittance flows are treated as negative COVID-19 led shocks in the nonlinear autoregressive distributed lag (NARDL) model. Negative tourism shocks are significant for all three countries, whereas negative remittance shocks are significant for Tonga only. Thus, the economic effects of COVID-19 are propagated by tourism for all three countries, whilst remittance is a COVID-19 transmission channel for Tonga only. Simulations with the projected declines in tourism and remittances suggest that Vanuatu would experience the greatest decline in growth and highest uncertainty, whilst Tonga would face the lowest decline and uncertainty.

Suggested Citation

  • Nikeel Nishkar Kumar & Arvind Patel, 2022. "Modelling the impact of COVID-19 in small pacific island countries," Current Issues in Tourism, Taylor & Francis Journals, vol. 25(3), pages 394-404, February.
    • Handle: RePEc:taf:rcitxx:v:25:y:2022:i:3:p:394-404
    DOI: 10.1080/13683500.2021.1963214
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    Cited by:

    1. Garrod Brian & Almeida António & Machado Luiz, 2023. "Modelling of nonlinear asymmetric effects of changes in tourism on economic growth in an autonomous small-island economy," European Journal of Tourism, Hospitality and Recreation, Sciendo, vol. 13(2), pages 154-172, December.
    2. Kumar, Nikeel Nishkar & Patel, Arvind, 2023. "Nonlinear effect of air travel tourism demand on economic growth in Fiji," Journal of Air Transport Management, Elsevier, vol. 109(C).

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