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CBSI says narrow economic base, high unemployment & other key areas remain unaddressed

Dr Forau
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The Governor of Central Bank of Solomon Islands Dr Luke Forau has warned that despite of positive grown outlook focused for this year, key underlying fundamentals of the economy remain unaddressed.

Launching the Bank’s 2023 Report, Dr Forau highlighted some of the key areas that had been unaddressed in the past.

He said in spite of this positive growth outlook: “The state of our economy remains fragile and susceptible to shocks.

He said the key underlying fundamentals of the economy remain unaddressed; this include but not limited to narrow economic base, high unemployment, narrow tax base, continuous fiscal deficit, low production, low demand, shallow market, shallow financial system, and weak monetary policy transmission mechanism.

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Meanwhile Dr. Forau confirmed that the Central Bank projected the post-Pacific- Games Solomon Islands’ economy to grow by 2.9 percent in 2024 and 2.5% in 2025. He said this growth projection is anticipated to come from a rebound in fishing and palm oil production, further expansion in the mining sector – with an expected increase in nickel exports – and continued infrastructure support by development partners. He added modest growth is also expected across all other sectors.

In the medium term, growth is projected to average around 2.5 percent. This is expected to be triggered by the staggered implementation of planned development projects and the continued prospects for global growth, as logging is forecasted to decline,” he said.



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