SI economy dropped before covid-19: CBSI

By EDDIE OSIFELO

THE Solomon Islands’ economy had slowed down prior to the coronavirus pandemic, according to a Central Bank of Solomon Islands reports.

Economic Association of Solomon Islands (EASI) President, Reuben Tovutovu said this in response to Asian Development Bank’s (ADB) Solomon Islands flagship report, the 2021 ADO Report.

The Asian Development Report states the country’s Gross Domestic Growth has contracted to negative 4.5 percent in 2020 due to the pandemic induced recession.

Tovutovu said the covid-19 only exacerbates (worsen) the decline.

He said some of the challenges resulting from this poor economic performance include:

1. Increasing unemployment rate and the likelihood of remaining high into the future, especially as new graduates enter the labor market,
2. further deterioration of the quality-of-service delivery. The reprioritisation policy needs to be managed effectively in order to avoid crowding out of investments in plans and activities that create social cohesion and crime-prevention. The one specific area of concern is the reallocation of funds from other ministries to ministry of health as a measure to contain the covid-19. In doing so, this will disrupt the flow of work plans of other important ministries, eventually affecting the key role of the government, i.e, service delivery.    One clear example is the postponement of tertiary scholarships since 2020.
3. Decline in the overall standard of living. It is hoped that the Government’s current freeze on new recruitment is only temporary.

EASI was established in 2001 as a Charitable Organisation.

Some of its main objectives include: to further the study of economics science, to stimulate economic research, discussions and debate in the country. 

As a professional body representing economists in the country, EASI has been conducting seminars with some key government ministries such as Lands and Ministry of Infrastructure Development, and recently collaborated with Solomon Islands Chambers of Commerce and Industries (SICCI) on “Private Sector Covid-19 Recovery Strategy”.