Offshore and tax information

Jurisdiction Home pages

 
Home - The Cook Islands - The Cook Islands page 1
Request more info on The Cook Islands offshore

The Cook Islands

Overview

 

The Basics

 

The Cook Islands are located about half way in between New Zealand and Hawaii in the southeast of the Pacific Ocean. Scattered over a large area, the Cook Islands have a total landmass of 241 square kilometers.

 

The islands are often subdivided into two groups based upon their geology. The islands to the north, Manihiki, Nassau, Palmerston, Penrhyn, Pukapuka, Rakahanga, and Suvorov, are low coral atolls. In contrast, the southern islands, Aiutaki, Atui, Manuae, Mauke, Mitiaro, Raratonga, and Takutea, are either volcanic in origin or raised coral atolls.

 

The islands tropical climate is tempered by cooling trade winds. The amount of rainfall each island receives varies greatly from island to island. Nevertheless, the islands suffer from typhoons from November to March each year.

 

The capital city Avarua, located on the island of Raratonga, is the commercial and administrative center of the islands. Raratonga is also home to an international airport offering daily direct flights to a variety of locations including Los Angeles, Auckland, Fiji, Tahiti, and Honolulu.

 

Closely related in tradition, language, culture and customs to the New Zealand Maoris, native Cook Islanders are ethnically Polynesian. The Maori language is widely spoken on the islands despite the fact that English is the official language. Due to British missionaries Cook Islanders no longer practice cannibalism are Christianity is the predominant religion.

 

Polynesians who migrated from nearby Tahiti were the first to settle the Cook Islands. They arrived in the 6th Century AD. Roughly one thousand years later, a Spanish navigator named Alvaro de Mendala become the first European to see the Cook Islands. In 1606 the Portuguese were the first to land on the islands, and later the Russians named the Islands after Captain James Cook, who traveled to them three times between 1773 and 1777. At their own request, largely to thwart French expansionism, the Cook Islands became a British Protectorate in 1888 and in 1901 they were annexed to New Zealand. They have been self-governing in a free association with New Zealand since 1965. New Zealand only provides them with support in external affairs, defense, and finances.

 

As in the case of many other locations, Western occupation brought not only a new religion but also devastating Western diseases that decimated the location population. In the case of the Cook Islands, the new diseases were so destructive that by 1850 less than 2,0000 indigenous inhabitants remained alive.

 

As of 2006 the island population was estimated to be just slightly more than 21,000. Throughout the 20th century economic difficulties instead of diseases have kept the population low as well at the annual population growth rate. Large numbers of Cook Islanders immigrate to New Zealand every year in search of employment.

 

Government and Economy

 

The government of the Cook Islands is a self-governing parliamentary democracy. The government includes a prime minister, a cabinet, and a 25 member legislative assembly. In addition, the tribal chiefs, called Ariki, have a house of representatives of their own. The legislative assembly submits matters to the Ariki for their consideration from time to time.

 

Avarua, the capital city, is the seat of the government. Given the Cook Islands continuing relationship with New Zealand, the Queen of English is the official head of State on the Islands in her capacity as Queen of New Zealand. New Zealand is further represented on the islands by a High Commissioner.

 

English common law and equity form the foundation of the Cook Island’s legal system. The Island’s parliament has been considered sovereign since 1965; this means that the parliament must approve and pass all new laws. The High Court of the Cook Islands is the superior court on record. Any further appeals must first go to the Court of Appeals and then to the Privy Council in England. Local and New Zealand lawyers provide legal services on the islands.

Because of their geographic isolation and lack natural resources, the Cook Islands economic development has been hindered. As the islands have little to export and need the majority of their goods to be imported, the Cook Islands regularly have a foreign trade deficit. The substantial gap between imports and exports, $41 million USD in 2000, is only partially bridged by remittances from emigrants.

 

In 1996 the government of the Cook Islands declared “bankruptcy” after a long period of rampant government spending. The government’s default has severely damaged the nation’s international reputation and external pressure has since forced the government to sell assets and cut its workforce and cost by over 50%. The government has tried to expand the mining and fishing industries in addition to encouraging tourism. Unfortunately, their efforts have been largely unsuccessful because of the exodus of citizens seeking relief from the nation’s dire local economic situation. The majority of these economic migrants have headed to New Zealand.

 

Fruit processing plants and a few clothing factories are the only manufacturing activities on the Cook Islands. The only agricultural exports are citrus fruit and copra, dried coconut meat. In addition to the agricultural exports, fish, jewelry, handicrafts, and mother of pearl shells are also exported. New Zealand dominates trade, as there are regular shipping connections there from the port at Avarua.

 

After nearly ten years of intensive efforts to rebuild the Cook Islands damaged economy, the Finance Secretary at the time, announced that the 2003 taxation revenue was almost double what it had been in the previous five years. The increase in revenues was attributed to tourism, the pearl industry, and the fishing sector. The government believes that the Islands can achieve growth levels of over 3% annually in the long-term. The government has also made having a fiscally responsible budget a priority.

Request more info on The Cook Islands offshore