Big companies likely to be the focus of any second round of ESP funding: PS Dentana

By Brian Lezutuni

A second Economic Stimulus Package (ESP) is possible depending on the outcome of monitoring and evaluation of the effectiveness of the current ESP payments.

 Permanent Secretary of the Ministry of Finance and Treasury, McKinnie Dentana told Island Sun future payments would likely be restricted to bigger recipients such as exporters rather than to small farmers or business-owners.

In the first phase of the ESP hundreds of farmers and other micro- and small-businesspeople benefited from funding for practical business inputs such as tools or planting material.

In July 2020, $124 million was allocated for immediate measures to help these businesses cope with the economic impact of the COVID-19 pandemic, including $70 million for rural production, $44 million for forestry, fisheries and tourism businesses and $10 million for assistance through the Development Bank of Solomon Islands. 

Further money was made available through Members of Parliament, a total of $42 million dollars.

The payments were due to be completed by July this year.

 Mr Dentana told Island Sun that the ministry of Treasury and Finance will need to see the report of the monitoring and evaluation phase of the payments before deciding on any future initiatives.

“We need to see how faithful people who receive our support are, there are some genuine recipients and some are not that genuine.

But he said any focus in the future should look at bigger players such as companies exporting kava, cocoa, foods, vegetables and cassava.

“These people are easy for us to get information (on), not like micro individual recipients which is challenging.

“Our export (income) goes back to rural people who bring their products for export, the government should only look at issues such as subsidy which it did on copra,” Mr Dentana added

The Permanent Secretary said the monitoring and evaluation report could be ready by the end of this month or in November.

Among those that have supported calls for a second round of stimulus assistance include local exporter Varivao Holdings.

According to General Manager, Benjamin Hageria the economic stimulus package is a lifeline to companies during the pandemic.

Varivao was among the larger local companies that benefited from the stimulus package and according to Hageria, the money was used to buy kava from locals to export.

Despite being provided a lifeline, the company only received two-thirds of the one million dollars it applied for under the stimulus funding.

“We have faced a lot of challenges and we were not able to go further on kava production, hence any similar assistance from the government as suggested by Opposition leader Matthew Wale recently is welcome,” he added

Meanwhile, the Permanent Secretary said a number of ESP recipients from the public have submitted their reports on the implementation of the ESP, including some of the exporters of copra, cocoa, timber and kava.

“A total of five Members of Parliament have also submitted their reports,” Mr Dentana said during his interview with Island Sun.

Apart from the report on the monitoring and evaluation of the Economic Stimulus Package, an audit of the whole funding package will be carried out as well.

The results will feed into preparations for the 2022 budget, which were launched last week by the Prime Minister, Manasseh Sogavare.

Mr Sogavare said the Government will continue to prioritise the productive and resources sectors in the 2022 budget as these two sectors are major drivers and enablers of economic growth.

“This does not mean that other sectors are not important, they will continue to be supported,” he said.

Under the Productive Sector, Prime Minister Sogavare said the Government is aiming to support infrastructure and communication investments, support food security, create employment and entrepreneurship to empower youth and women.

The Ministry of Finance and Treasury and the ESP Committee of which McKinnie Dentana is Chairman  will have important input.

“With the Information from the team I can recommend to government whether to roll out another ESP scheme or not,” Mr Dentana said

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