The Cook Islands occupy a paradox familiar to small Pacific nations: 15 islands scattered across nearly 772,000 square miles (2 million square kilometers) of ocean, with virtually no domestic energy resources and a total reliance on imported fuel. Yet the country is emerging from the global energy crisis not as a casualty of high prices but as an economy positioning itself to profit from them.
After a strong post-pandemic rebound, the economy grew 7.2% in real terms in 2024, 14.7% in nominal terms, lifting GDP to US$386 million (NZD$684.2 million), according to the Cook Islands Statistics Office. Growth is now expected to cool as the economy nears capacity, settling into what officials describe as a more sustainable phase. The Ministry of Finance and Economic Management (MFEM) forecasts expansion of around 2.9% in 2026, with GDP projected to reach US$423 million (NZD$748.6 million) in 2025/26.
For Joaquin Vespignani, MFEM's Director of Economic Planning, the more consequential story lies beneath the waves. The Cook Islands sit atop vast fields of polymetallic nodules rich in manganese and cobalt, minerals the International Energy Agency classifies as critical to the global energy transition. As decarbonization, electrification and battery manufacturing accelerate, demand for these inputs is expected to climb sharply.
"These resources are directly linked to clean energy technologies, meaning that as energy prices rise, so too does the value of these exports. This creates a natural hedge for the economy."
That hedge is the strategic heart of the country's plan. Because the Cook Islands import 100% of their fuel, rising global energy prices, driven by geopolitical tension and surging demand from energy-hungry technologies like artificial intelligence, would normally squeeze the budget. By developing minerals whose value moves in the same direction, the country aims to turn an external threat into an export opportunity. There is ambition beyond simple extraction, too: Vespignani points to the possibility of higher-value processing, potentially in partnership with Australia, which could multiply the resources' economic value several times over.
He is emphatic that this will not come at the ocean's expense. The government's approach, he says, is science-led and evidence-based, built on years of independent baseline research and environmental monitoring. Any decision on development, he insists, will be governed by that evidence rather than by commercial pressure.
"Our aim is to demonstrate that a small island state can develop these resources to the highest environmental and scientific standards, protecting the long-term health of the ocean while contributing to the global energy transition."
On energy itself, the strategy runs on three time horizons. In the short term, measures such as free public transport are designed to curb fuel consumption and ease cost pressures on households. In the medium term, the country is accelerating the integration of solar power into its national grid with support from international partners. Over the long term, a comprehensive Energy Efficiency Act will promote energy-saving practices across homes, businesses and infrastructure, aligning the Cook Islands with international standards and, officials hope, making the country more attractive to investors.
Solar, Vespignani argues, is the Pacific's single greatest opportunity. Advances in battery storage and remote monitoring have transformed its viability, and AI-driven diagnostics now allow dispersed island systems to be managed efficiently from afar. A hard-won lesson from earlier projects, he adds, is that energy systems must be tailored to local conditions, smaller islands often being better served by decentralized solutions than by a single centralized grid.
The financial architecture behind all this is just as deliberate. Rather than leaning on royalties or profit taxes, the Cook Islands are drawing inspiration from Norway's model of public shareholding, which aligns the interests of investors and the state so that both benefit from success. Resource revenues, in turn, would flow into a planned Sovereign Wealth Fund designed to insulate the windfall from political cycles and preserve it across generations. The long-term vision is to channel those returns into pensions and education, and, more immediately, to use the fund as a stabilization buffer the country can draw on during crises.
Diversification rounds out the agenda. Beyond seabed minerals, Vespignani sees the strongest long-term potential in financial services and the digital economy, particularly in attracting digital nomads and remote professionals who can lift economic activity with minimal environmental strain. Seabed mining, he notes, could generate substantial early income without requiring a large domestic workforce, while financial services should expand alongside rising incomes. Tourism will remain important, he says, but it will no longer be the primary engine of growth.
Underpinning the forecasts is a quieter push toward digitalization. MFEM is working to integrate data across sectors and, with support from academic and international partners, is adopting AI-based forecasting models intended to sharpen policy and improve the transparency of government services.
Asked what he would tell readers in Los Angeles, Vespignani returns to a theme that runs through every part of the plan: resilience. As a Pacific nation, he says, the Cook Islands have long adapted to natural shocks, producing a pragmatic and forward-looking society. The aim now is to pair that instinct with a clear economic strategy, diversifying the economy, deepening ties across the Asia-Pacific region, and investing in future generations, to build something prosperous, sustainable and durable.
For a nation of roughly 17,000 people facing some of the world's largest economic forces, it is an unusually confident bet: that the same global pressures threatening small island states might, handled well, become the foundation of their prosperity.
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