Tonga Country Report
The dissolution of Prime Minister 'Akilisi Pōhiva's government in August 2017 signified resistance from the monarchy to Tonga's democratic transition. The main risk facing the country is policy uncertainty. Probable delays to the ratification of the pro-business policies of the Pōhiva government, including the PACER Plus trade agreement, could undermine Tonga's position as the most business-friendly of the Pacific Islands.
The government encourages foreign investment and has gone to great lengths to improve legislation. Some of Tonga's infrastructure is in good condition, including its transportation system. However, most businesses use generators to mitigate an unreliable power supply, and about 20% of the country lacks electricity. Tonga became a prospective member of the Asian Infrastructure Investment Bank in June 2017, suggesting the possibility of new infrastructure developments in the country.
There is no known terrorist threat in Tonga.
Tonga enjoys good relations with its neighbours and there is no material risk of interstate war. On 14 June 2017, Tonga signed the PACER Plus agreement, indicating a continuation of close relations with other Pacific Island nations.