BY LORETTA B MANELE
Rex Ramofafia, Minister of Finance and Treasury (MoFT) says climate change is no longer just an environmental issue, but a a key economic issue as well.
He made the remark when delivering the keynote address at the “2nd CBSI-ADB-APAEA Joint Workshop” last Friday at Heritage Park Hotel.
Ramofafia said for small island economies like that of Solomon Islands, climate events directly affect food prices, infrastructure and trade.
“When supply chains are disrupted by floods, storms and droughts, prices rise, our people bear the effects of climate-induced inflation through higher costs of goods and services,” he said.
Ramofafia stressed that while global energy and commodity markets have remained relatively stable in recent times due to muted global demand, the risks from climate-related shocks persist.
He said this means our monetary policy frameworks need to account for climate risks and potential price volatility.
Moreover, the Member of Parliament for Fataleka Constituency said fiscal policy has a role to play.
“By investing in private fiscal infrastructure, that makes our economy more resilient, and by supporting a shift towards renewable energy,” he said.
Ramofafia went on to state that research on how climate change affects inflation in some islands is especially relevant.
He said it gives us local evidence on how global issues are shaping our economy and how monetary and fiscal tools can work together to keep prices stable while maintaining macroeconomic stability, as well as building a climate-efficient economy.
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