New Caledonia’s Unrealized Legacy


Unlike earlier in its eventful history, New Caledonia today rarely captures public and media attention—whether Australian or international—except perhaps as a tourist destination. Yet ignoring it would be a mistake, as even a cursory look at the islands’ potential underscores the territory’s varied strategic importance to the region.

A country’s strategic importance tends to be measured in several ways. Political elements are often considered, including military potential and capacity. However, while these are important considerations, in the future, factors such as the levels and diversity of resources a region or territory possesses will become increasingly important. Placing more weight on such considerations will be especially vital in the coming decades, where sustainability and supporting growing human populations will be of paramount importance to human survival.

Chrome, iron, cobalt, manganese, silver, gold, lead, copper and particularly nickel dominate New Caledonia’s mineral resource portfolio. Over 25 percent of the world’s nickel ore reserves lie here, and although price fluctuations in the world market have recently been volatile, there’s no question that this metal will remain—if not increase—as a staple of industry, including for the production of vehicles, construction materials and components for electrical goods and machinery.

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Just how valuable these minerals will become, and the extent to which New Caledonia will develop to refine and export these resources, remains to be seen. New Caledonia’s mineral export partnerships are, however slowly though, shifting, and will likely continue to do so as the industrial thirst of Asia’s developing economies grows. If this occurs, future competitive tensions with fellow mineral export giant Australia can’t be discounted. But while the land down under may boast its own mineral resources, having New Caledonia’s nearby and secured might actually be a positive for Australia in the foreseeable future.

But there are potential problems ahead for the territory. Although New Caledonia’s per capita GDPis larger than New Zealand’s, its imbalanced economy poses a serious challenge to its political future. Currently, it’s being kept afloat and protected by France’s own economic trade portfolio. However, what would happen if New Caledonia were no longer part of this type of larger trade framework? Its economy would need full restructuring to avoid vulnerability in its key trade sectors, and it would have to swiftly find new trading partners.

One of its most vulnerable sectors is energy. Energy is the lifeblood of New Caledonia’s mineral wealth, as its home-grown energy resources are modest and hydroelectricity remains a problematic alternative to a heavy dependence on imported fossil fuels.  The vast quantity of energy that mineral extraction consumes also leads to another problem—one of the highest per capita carbon footprints in the Pacific.

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