Small Island Developing States (SIDS) were recognized at the 1992 United Nations Conference on Environment and Development (UNCED or Earth Summit) held in Rio de Janeiro, Brazil as a distinct group of developing countries facing specific social, economic, and environmental vulnerabilities. SIDS tend to confront similar constraints in their sustainable development efforts, such as a narrow resource base, which deprives them of the benefits of economies of scale. They also have small domestic markets and heavy dependence on a few external and remote markets, as well as high costs for energy, infrastructure, transportation, and communication. Islands tend to be long distances from export markets and sources of imports, have low and irregular international traffic volumes, resulting in a high volatility of economic growth, limited opportunities for the private sector, and a large reliance of their economics on the public sector. Islands also are highly vulnerable to natural disasters and climate change, and have fragile natural environments, which are further threatened by population growth.

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