Enabling economic growth in Solomon Islands

Overview

Australian assistance will address constraints to growth in Solomon Islands' economy. We will continue to support infrastructure programs essential for business and trade. This includes reliable access to transport, water and energy. Australia will engage strategically with Solomon Islands Government (SIG) through: dialogue on economic and fiscal policy; assistance to improve public financial management; and advocacy for reform on the existing regulatory and compliance burden on business.

In 2017-18, the Solomon Islands Growth Program will be the flagship for Australian support to increase private sector investment in a more inclusive economy. It will aim to catalyse private sector investment and increase opportunities for inclusive growth by targeting industries with the highest potential (tourism and agriculture, for example). Particular focus will be given to promoting women's participation and reducing costs to business.

In 2015-16, Australia launched the new $16 million Skills for Economic Growth Program. The program aims to support businesses through growing Solomon Islands' national workforce and enhancing labour productivity in areas of high labour market demand, including for women and girls. In 2015-16, Australia's total aid for trade scaled up significantly, reaching 19 per cent of our total bilateral investments (up from 12 per cent in 2014-15).

Australia is supporting the Tina River Hydro Project which is intended to become Solomon Islands' first public-private partnership. The dam and power station could meet up to 80 per cent of Honiara's energy needs, significantly reducing Solomon Islands' dependence on diesel power and unlocking the potential for economic growth. Since 2009, Australia has provided over $5.3 million through the World Bank to support SIG with project preparation and to undertake environmental and social impact studies. We have provided $2.4 million through the International Finance Corporation to support the bidding process and developer selection.

Through regional programs, Australia will provide support for fisheries management – including effective regional cooperation with the Forum Fisheries Agency and the Secretariat of the Pacific Community – and improved market access for Solomon Islands' exports.

Australia's Seasonal Worker Programme (SWP), led by the Department of Employment, connects Pacific island and Solomon Islands workers with Australian employers experiencing labour shortages, typically in rural and remote areas. This benefits both parties and the average worker remits around $5,000-$6000 during a six-month placement.

Australia will look for opportunities to assist Solomon Islands to fully benefit from the Pacific Agreement on Closer Economic Relations (PACER) Plus, when finalised.

Related initiatives

Transport Sector-Based Approach

Up to $36.9 million, 2010-2015

Australia is providing funding over five years to the National Transport Fund to directly support SIG to maintain and improve transport infrastructure, including roads, bridges and wharves. Priorities are set out in the SIG's National Transport Plan. Australian funding is delivered in partnership with the Asian Development Bank's Transport Sector Development Project which is helping to build the skills and systems of the Ministry of Infrastructure. Maintenance and rehabilitation works are contracted out to the private sector, generating business and employment opportunities in Solomon Islands.

Related documents*

Name of document Year published Type

Joint Review of the Solomon Islands National Transport Fund

2014

Review

Solomon Islands National Transport Fund Board response to the Joint Review of the Solomon Islands NTF

2014

Management response

Related links

Urban Water Supply

Up to $13.1 million, 2011-2016

Australia is funding the Solomon Islands Water Authority (Solomon Water) to implement its Development Plan 2013–16. Solomon Water is reforming its organisation and improving its infrastructure to provide greater access to clean and reliable water supply in Honiara. This builds on the success of Australian funding for Solomon Water's earlier Short-Term Recovery Strategy and Action Plan (2011–14).

Related documents*

Name of document Year published Type

Solomon Islands Urban Water Supply Short Term Recovery and Action Plan

2011

Design

Solomon Water Development Plan 2013–2015

2013

Design

Solomon Islands Rural Development Program

Up to $31.8 million, 2008-2020

The Rural Development Program is a joint program with the World Bank, Australia, the European Union, International Fund for Agricultural Development and the Solomon Islands Government. The program is raising the living standards of rural households by improving infrastructure and services, as well as helping the Ministry of Agriculture and Livestock to deliver advice and services to farmers. Phase one of the Rural Development Program (2008–15) had three components: building small-scale village infrastructure, building capacity in the Agriculture Ministry, and assisting rural businesses with training and finance. Phase two (2015–20) will provide small scale village infrastructure projects in every rural ward of the Solomon Islands, support productive alliances between private sector and smallholder farmers, and stimulate agribusiness activity in rural areas.

Related links

 

 

* The Department of Foreign Affairs and Trade (DFAT) is committed to high standards of transparency and accountability in the management of the Australian aid program through publishing information on our website, including policies, plans, results, evaluations and research. Our practice is to publish documents after the partner government and any other partners directly involved in the delivery of the initiative have been consulted. Not all material published on this site is created by the Australian aid program and therefore not all documents reflect our views. In limited circumstances some information may be withheld for reasons including privacy and commercial sensitivity.



Last Updated: 9 May 2017