Food 65% more expensive in New Caledonia

Life on a desert island in the South Pacific. A dream come true, right? Palm trees, blue skies, light warm breezes. Sunny weather all year ’round, clear waters, white sands. Utter bliss.

Cut.

A report released yesterday shows just how much a life such as this will cost you – above and beyond life in France, for example. The most expensive of France’s territories, prices here are, on average, 34% higher than in France. The second most expensive French territory is French Polynesia (Tahiti), at 26% higher. The cheapest French overseas territory is Reunion Island, with a price difference of  just 6% higher.

Let’s take a look at the price comparisons from the report:

Price comparisons: New Caledonia vs. France

Cost in New Caledonia
Food products

+65.4%

Leisure activities

+43.4%

Restaurants and hotels

+42.8%

Alcoholic beverages and tobacco

+42.5%

Housing, water, electricity

+38.9%

Clothing and shoes

+38.6%

Furniture and appliances

+38.3%

Communications

+35.6%

Health

+34.4%

Other products and services

+27.0%

Transport

+0.9%

Total average

+34.0%

I’ve mentioned the exorbitant prices before, but it is something else to see it confirmed in black and white. The high cost of living has been in the press recently and last year, 20,000 people in New Caledonia took to the streets over it.

A local shop-owner explained to me that everything is taxed at at 45% (meaning business owners are paying 45% on imported goods to the government), which accounts for the high prices (but how do we explain high rents, high communication costs, etc.?). He explained that it is next to impossible to pass on savings to customers with such a high overhead. Another person explained that as there is so little competition here (there is a monopoly on mobile and phone communications, for example), the consumer has no choice and is at the will and the whim of the provider.

But my question is how those on low incomes manage (including not only the working, but students and the elderly).

I read today that only 3% of the local majority population (Kanaks) complete higher education and 38% of young Kanaks are unemployed. Very few of them have much of an opportunity to manage, preside over or run a business or work in “knowledge worker” or decision-making positions. Those who are working appear to be doing so in low-paid, low-skilled jobs.

So how much does one earn in a low-paid, low-skilled job in New Caledonia? The minimum wage here is 888 CFP an hour, or 150,000 CFP a month (169 hours) – which works out to €1,257 per month (USD 1,639). (This assumes that the low-paid wage earner is being paid at least minimum wage.)

The net minimum wage in France (four 35-hour work weeks) is €1,426 –  €169 more than in New Caledonia. Yet low wage earners in New Caledonia are paying 65% more for food (which is said to make up 18% of a household budget) than their French counterparts. How?

Clearly they are making do with less.

Another article today highlighted that there are potential gender issues when it comes to high cost of living. High prices affect women differently from men suggests the Union of French and Pacific Women (UFFO), which is trying to sensitize the public to the fact that women who live in tribes far from the city centre are deprived employment opportunities and education. Thus, a high cost of living hits them harder and potentially puts them at much greater risk for poverty than men. This being said, nearly one in five (17%) live below the poverty line here.

All of this gives one pause.

What are the answers?

  • Take a closer look at importation taxes?
  • Encourage competition?
  • Encourage (higher) education for all?
  • Create incentives for upskilling?
  • Create better jobs?

Answers in the comments section, please! I’m curious to hear what you think.

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23 thoughts on “Food 65% more expensive in New Caledonia

  1. Pingback: Nouméa: From mortifying to festive | New Caledonia Today

  2. Hi Julie,

    to answer your question I think life for the low income here is very complicated. I talked a bit with a Doctor few months ago and he told me that here some people have malnutrition issues. When parents are poor, they generally give less meat and less milk (and sometimes very rarely) to their kids… I love the New Caledonia but the cost of living is a big problem here!

    • Many thanks for your response, Francois. That’s what I am worried about – how our low-income families are coping. Rarely giving milk and meat to growing children, reports of malnutrition, this worries me. Do you know what the government is planning to do to tackle the high cost of living?

  3. I’m here since only 6 months so I won’t be able to answer but honestly I don’t think the government is really concerned by this issue. They seems more concerned by the debate around 2014 and their own conflicts. In my own opinion, they should be very concerned because a lot of the problems here, are linked to this (Violence, racism)… It’s maybe this “New Caledonia Time Warp” you described, I don’t know… As a family father, that’s the main (only?) reason that make me hesitate to stay for a long period here… Or maybe they just want to keep some “problems” here just to be sure to don’t have a lot of people here… If it’s that, I understand them ( un peu ! :))

  4. I agree – the deepening divide between the haves and have nots in New Caledonia appears to be leading to increased violence, conflict and crime. And it has been going on for a while (it appears to be mounting recently, and I hear it is due to mount in the run-up to 2014). It occurs to me that if some (many) are not able to house themselves or feed their families, conditions will only be repeated in future generations. The fact that only 3% of Melanesians complete higher education and that 48% are unemployed is very worrying for a developed country (as a part of France). I was reading that the government is looking into what can be done, but it is not clear to me yet what their precise actions will be.

    Happy to hear from you, Francois – it sounds like we are both newly here and are learning on the ground. Happy my blog was helpful for your relocation! I considered taking it down, but some of the content (like cost of living) was useful – even for me in coming back. Things have not gotten cheaper …

  5. Even though this country evolved a lot, it still works like a colony. And like a French colony (which is not a good thing at all imo). We’ll see how it will be for 2014 but I don’t trust the politicians here. They seems more concerned by their interest than the country itself, especially the loyalists.
    The fact that a lot of Melanesians are unemployed or don’t complete higher education is also linked to their lifestyle I think. Outside of Nouméa, Melanesians don’t really need to “work” in a occidental point of view. I don’t mean they don’t work of course, but generally they lives in their own land (terres coutumières) and they feed their own needs (food, etc.) by themselves. That’s one of the thing that I really admire : they stayed quite hermetic to the occidental way of life and kept their traditions.
    However, I think the violence will increase. Young melanesians start to want the same things than the europeans (big car, flat TV) and with the cost of living here, their frustration will be high soon.

  6. I wonder what has changed since 2005-07. Is it a greater income divide? More haves? It’ll be interesting to see how it evolves. I’d like to be part of the solution (and not add to the problem) – and I agree that respect for Melanesian culture and values is critical (though lacking, it seems) as we move forward.

    • The cost of living is a bit scary. I think we all agree. But there are ways around it – changing the nature of things you buy, making do with less, etc. Our biggest expenditure after food is communications, because I am not willing to go with a slower connection or without a mobile phone. But we are not buying clothes, books or many “things” here. We tried to bring as much as we could that we would need and will be flying back to the US and France next year (and picking up supplies). It is a good exercise in living with what you have and foregoing the less important. 🙂 If there is anything we can do to help with your move, let us know, Monique!

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  8. Thank you for your post. Possibly going to Noumea within a couple of months for a short stay. What is to happen there by 2014? is NC finally heading to independence? In respect to prices, please tell, me is it that at the supermarket you find french dairies or australian or kiwi ones? By all means, should be aussie products, would be cheaper. If are not, you have a response to one of the questions posed above.

  9. Do you have any kind of public transport? how much does a taxi cost? How much is buying a cheap basic bike? Is it safe to go walking of biking around or should I consider NC is like Port Moresby? something in between?

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  14. Dear
    Will it be so hard to establish a business in New Caledonia?
    I mean will they be willing to encourage foreign investors ?
    I m Lebanese and willing to check the situation over there by spending few weeks at the island but it would be nice if you share with us your experience

    • Hi Georges – My sense is that business if very local in New Caledonia. Though I do know some entrepreneurs there, I wouldn’t say it is particularly easy to start a business. I do recommend visiting to research the possibilities yourself, and wish you luck! If I can help further, please let me know! – Julie

  15. We have just returned from Noumea after only staying 2 nights, planned 6 nights stay. We were appauled at the cost of food and beverages, alcoholic and non alcoholic. We are from Sydney Australia and we pay generally a quater of what the proces are in Noumea. Unfortunately we would not return due to the high cost of everything.

    • Dear Hayley – I hear you. When we lived in Noumea, we were so happy to get to Australia for many reasons, the affordability of food/clothes/toys/books among them. It is very hard for the locals to afford what you can afford in Sydney. It takes some getting used to. I’m sorry you had to cut your trip short for this reason. Kind regards – Julie

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