The Impact Investment in Pacific is Driven by the Diaspora

TechInPacific – Caleb Jarvis, the Pacific Trade Invest Australia’s Trade and Investment Commissioner as well as the author at devpolicy.org wrote an article stating that the Pacific diaspora is the drivers of impact investment in the region.

Jarvis mentioned two investments which were facilitated by PTI Australia – Tanna Coffee and Coconut Cluster are potential to boost sustainable economic growth and support the development of value chains. However, Jarvis emphasized that not all businesses in the region are required for impact investment due to lack of financial support and governance systems in place.

Finding investors is difficult. The lack of investment-ready opportunities and market understanding, Pacific investment is perceived as at high risk. As a result, many businesses in Pacific reconsider their investment strategies. There’s a gap between the big businesses and microbusinesses in terms of funding. While big businesses remain well funded, microbusinesses are the other way around. Most of the time, they get funded by microfinance agencies, friends, or their family.

According to Jarvis, small to medium-sized businesses show the ideal condition for impact investment as investors interested in the social and environmental return can wait patiently for financial returns.

In the Pacific economies, remittances play a major role. There’s a growing number of the Pacific diaspora finding ways to contribute to the region through remittances. They use their expertise, networks, and capital to help businesses ready for impact investment. Eventually, the investment is expected to bridge the gap in the impact investment ecosystem.

Jarvis stated in his article that the Pacific diaspora in Australia plays a major role in driving the impact investment space in the region due to their strong connection, both culturally and emotionally, to the region. In other words, their contribution is the drivers of the Pacific’s economic development. Their contribution worth more value in the social impact rather than other major investment.

The original article is written by Caleb Jarvis at devpolicy.org. You can read his full article here.