Introduction Niue’s private sector plays a central role to the country’s economic development by providing employment, supporting livelihoods, and driving opportunities for growth. Tourism remains one of the Niue’s most important industries, but its impact extends beyond visitor spending alone. A significant share of tourist arrivals, particularly from New Zealand, consists of Niueans and their families returning to visit relatives and maintain social and cultural ties. These visitors contribute to the economy in an unconventional way since they support households through remittances and spending within local communities. Further, the tourism sector generates demand for accommodation, transport, food services, and other services. However, businesses face persistent challenges that raise operating costs and weaken confidence. Structural constraints limit the island’s ability to diversify its visitor offerings and grow sustainably. While visitor arrivals continue to support economic activities, the performance of the private sector depends on how businesses operate. Evidence from the 2024 Business Establishment Census (BEC) highlights key operational challenges, which include delays in government services, unreliable electricity supply,[1] intermittent internet connectivity, and slow payment processing. These bottlenecks reduce productivity, discourage investment, and constraint job creation. While these challenges are evident in tourism-related businesses, these also reflect a broader constraint across the private sector. Recent BEC data provide clear signals on where reforms—such as improving infrastructure, streamlining regulations, and enhancing digital systems—can deliver the greatest impact for tourism and the wider economy. Tourism Business Landscape Niue’s economy is dominated by small, service-oriented firms that are closely linked to tourism and domestic commerce. Accommodation and food services account for 21% of establishments, while wholesale and retail trade make up 17%. More than 70% of businesses operate as sole proprietorships and fewer than one in 10 are registered as limited liability companies. Niue may be in the remote part of the Pacific Islands, but tourism continues to anchor the country’s private sector and offers the most immediate pathway for growth. Visitor arrivals increased by 28% in 2024, driven largely by travelers from New Zealand. International visitors spent an average of NZ$1,566 (almost $920) locally per trip, generating significant spillovers across accommodation, transport, retail, and other services. It should be noted that substantial proportion of visitor arrivals from New Zealand are Niueans who are visiting relatives rather than traditional holiday visitors. This distinction is important as some tourists will be staying with relatives and contributing through community spending. Visitor satisfaction is high, with 98% willing to recommend Niue as a destination. Growing interest in ecotourism and cultural experiences suggests further scope to increase visitor spending and length of stay. Unlocking this potential will require targeted investment in infrastructure, digital connectivity, and hospitality services. Pacific hospitality is one of Niue’s strongest attractions, rooted in the warmth of its community. Niue is also recognized as one of the safest destinations in the Pacific. Its quiet atmosphere, low crime rate, and relaxed pace of life make it especially appealing to travelers seeking peace of mind and tranquility. Beyond its people, Niue offers untouched natural wonders—coral reefs, limestone caves, whale‑watching, and world‑class diving. The island’s strong commitment to conservation ensures these experiences remain authentic, sustainable, and true to Niue’s low‑volume, high‑value tourism mode. Challenges Niue has significant tourist attractions, but irregular flight services limit the country's ability to fully showcase and capitalize on its tourism potential. Also, accommodation constraints have dampened the tourism industry’s post-pandemic recovery as arrivals in 2024 were still 32% below 2019 figures. Low levels of formalization restrict small firms’ access to finance and limit their ability to manage risk or expand. Foreign investment remains limited. Only 2.4% of establishments report foreign ownership, reflecting the challenges posed by geographic isolation, high transport costs, and a small labor pool. Weak business practices further reduce resilience, with 67% of firms reporting no regular stocktaking. Implications Despite strong tourism performance, Niue’s private sector remains vulnerable. Heavy reliance on a narrow set of activities heightens exposure to external shocks, while small firm size and informality constrain innovation and adaptation. Operational inefficiencies and infrastructure gaps further weaken competitiveness. Without reforms to strengthen the business environment, these constraints risk reinforcing low productivity and limiting the economy’s capacity to diversify. Addressing them is therefore critical to improving resilience, supporting inclusive growth, and sustaining public finances over the medium term. Way Forward Priority policy reformsExpanding Niue’s tourism market will require coordinated institutional and regulatory reforms that create a stronger enabling environment for local enterprises. Institutionalizing the BEC and establishing a comprehensive business register would provide reliable and timely data to support evidence-based policymaking, economic planning, and private sector development. Beyond tourism, these data systems would generate valuable information on employment, business demographics, industry structure, and other key economic and social indicators, which will enable the government to design interventions more effectively to target stakeholders. Integrating tourism business with relevant business registration and and licensing system can streamline compliance, improve service delivery, and reduce administrative burdens for operators. Digitizing government services and payment systems would directly address key bottlenecks identified by tourism firms, making it easier for small operators to participate in the sector. Infrastructure improvementsInvestment in reliable electricity, transport, and digital infrastructure is essential to support e-commerce platforms, online bookings, and digital marketing—critical tools for attracting international visitors. Targeted ease-of-doing-business reforms and incentives can help attract foreign investment into niche tourism sectors, such as ecotourism, diving, whale-watching, and specialty cultural products. Better business practicesAt the firm level, strengthening financial management, inventory control, and digital literacy will be critical to building resilience among tourism operators. These capabilities will support sustainable, inclusive growth by ensuring that Niuean businesses can adapt to changing visitor requirements. Note: This article is derived from the Asian Development Outlook April 2026: The Middle East Conflict Challenges Resilience in Asia and the Pacific. [1] It should be noted that Niue officially launched its new power station in November 2024, around the same period that data collection for the Business Establishment Census (BEC) was being conducted. The commissioning of the new power station marked a major milestone in modernizing the country's energy infrastructure through support from the Australian and New Zealand governments and other development partners. The new facility is expected to strengthen the reliability of Niue’s electricity supply and support the country's transition toward its target of generating 80% of its energy from renewable sources by 2025. References Ministry of Finance, Government of Niue. 2024. Niue Quarterly Economic Update: June 2024. Niue Statistics Office, Government of Niue. 2024. Highlights of the Results of the 2024 Business Establishment Census in Niue. UN World Tourism Organization. 2023. Tourism and Economic Resilience in Small Island Developing States. World Bank. 2020. Doing Business in Small States: Reforming the Business Environment. Ask the Experts Isoa Wainiqolo Senior Economics Officer, Pacific Department, Asian Development Bank Isoa Wainiqolo works at ADB’s Pacific Subregional Office in Suva, Fiji. He currently serves as the country economist for the Cook Islands, Niue, and Tonga, supporting ADB’s programs and initiatives. Prior to joining ADB in 2019, he worked as an economist and senior economist at the Reserve Bank of Fiji for 12 years. He holds a master’s degree from Columbia University in the US and a bachelor’s degree in economics and accounting from the University of the South Pacific. Pamela Lapitan Statistics Officer, Data Division, Economic Research and Development Impact Department, Asian Development Bank Pamela Lapitan has a degree in Statistics from the University of the Philippines Los Baños. Prior to joining ADB, she was officer-in-charge and statistical coordination officer of Regional Division IV of the National Statistical Coordination Board. She was also an instructor at the Rural High School and the Institute of Statistics of UPLB and worked for Bayer Philippines, Inc. Her interests include statistical analysis, planning and conducting surveys and experimental designs, geographic information systems, poverty statistics, national accounts, and small area estimation. Follow Pamela Lapitan on Leave your question or comment in the section below: View the discussion thread.