1. Salutation
- The Honorable Minister of Finance & Treasury
- Honorable Ministers of the Crown, and Members of Parliament
- Permanent Secretary of Finance and Treasury
- Other Permanent Secretaries, and Senior Government Officials
- Excellencies Representatives of the Diplomatic Corps
- Central Bank Directors
- Heads of Financial Institutions
- Heads of Statutory Authorities
- Representatives of Non-Government Organizations
- Representatives of the Private Sector
- Solomon Islands Chamber of Commerce Board and CEO
- Representatives of the Media
- Distinguished Guests
- Ladies and gentlemen
It is indeed an honor to warmly welcome you all to today’s event. Thank you for joining us today and for lending your valued presence to what is one of the significant events in the Bank’s calendar.
My remarks this morning will focus on an assessment of the country’s economic performance, and provide you with some food for thought as to how we can move forward in terms of developing our economy.
And please note, this assessment does not prescribe specific policies that should be undertaken, as some of you may have thought, rather it points out direction as to where we should focus our effort and resources to ensure optimal results are achieved in terms of improved economic wellbeing.
That said, I want to use this opportunity not simply to present statistics, but to peek beyond the numbers — to the families behind every figure, the farmers behind every forecast, and the future behind every policy. Let these figures serve as a mirror, to help us reflect on our strengths and weaknesses, and as a compass to help us chart our path forward with firm commitment.
Setting the Scene – Harnessing the Spirit of the Pacific Games
Before delving further, let us pause and reflect briefly on one of our proudest moments as a nation in recent years – i.e., the 2023 Pacific Games. Remember that?
For two golden weeks, our nation came alive. We cheered, we celebrated, we stood as one. Every athlete had a goal, every coach had a plan, and every volunteer had a role. And we, as a nation — from all the corners of the nine Provinces and from all walks of life — united to deliver one of the most (if not the most) successful Pacific Games ever.
What fueled this event to be successful?
You may have your own views on this, but for me, the 2023 Pacific Games was a success due to four key critical and inter-related factors:
- (i) Very clear goal: – it was clear that the ultimate goal is to build a state-of-the-art stadium facility that will accommodate all athletes to compete.
- (ii) Shared ownership: – having known what the goal is, and given that it is a national pride, everybody wants to own it, everyone feels the sense of belonging.
- (iii) Dedication and determination: – knowing that we own the facility, we own the games, we dedicate all our efforts with determination to ensure the Pacific Games is successful.
- (iv) A collective urgency to deliver excellence: – knowing that we are running out of time, there is a call for urgency to collectively ensure the facilities are completed on time.
Ladies and gentlemen, we did not just make it, but we also achieved and fulfilled our goal of hosting the Pacific Games, despite the challenges.
Today, we gather at a time of profound geopolitical and geo-economic fragmentation and uncertainty: Trade tensions are intensifying, seemingly rock-solid geopolitical ties are fracturing, and the post-war era of trade-driven globalization seems to be visibly losing steam. Meanwhile, even as the world scrambles to respond to all these challenges, climate-related shocks continue to intensify in both frequency and severity.
So, yes: just as we came together, cooperated and strategized to deliver on our ambition to host the 2023 Pacific Games, so too are we called upon to unite in response to the challenges we face.
Our theme today entails:
“Building the future we want through determination with clear goals and a shared ownership that calls for urgent action to deliver excellence.”
Let that theme simmer in your mind, as I will return to it later. For now, let me briefly reflect on last year’s economic conditions.
2. Brief Economic Update
Global economy
In 2024, the global economy demonstrated resilience even in the midst of continued uncertainty. The International Monetary Fund estimates global growth to have grown by 3.3% last year. This slowdown was largely driven by anaemic growth in Emerging Market and Developing Economies, not least due to the conflicts in the Middle East and Ukraine, and the enduring malaise in China’s property market. Closer to home, Australia and New Zealand, too, experienced a moderation in growth as Central Banks continued to combat inflation in these economies. More generally, global inflation continued to ease throughout 2024, supported by falling energy prices and stable food prices, and a slight cooling in labour markets worldwide.
Domestic Economic Growth
On the domestic front, economic growth slowed down to 2.8% in 2024, down from the Pacific Games-boosted 4% expansion in 2023. Growth in 2024 was driven mainly by fishing, forestry, mining, construction, and manufacturing, while copra and palm oil weakened further.
Labour Conditions
For the labour market conditions, it remained stable, with proxy employment indicators such as SINPF member contributions and PAYE tax revenue showing increasing trends, with the former rising by 4% and 8% respectively.
Inflation Dynamics
In terms of inflation, the headline inflation rose to 4.6% at the end of 2024, compared to 3.5% at the end of 2023. This was driven primarily by domestic inflation, which surged by 6.1% in December 2024, reflecting a 20% increase in betel nut prices. In contrast, imported inflation eased to 1.2% from 4.6% in 2023, on the back of falling global fuel prices.
Core inflation fell to 1.9%, after peaking at 3.2% in June. Importantly, both headline and core inflation remain within the CBSI´s desired range.
External Conditions
On the external sector, the overall balance of payments (BOP) surplus increased by 60% to $350 million. As a result, the country’s gross foreign reserves grew by 1% to $5.8 billion, sufficient to cover 11.3 months of imports. This is well above the CBSI’s precautionary import cover threshold of 6 months.
In case you are interested to know how much we earn from remittances through seasonal workers, total remittances from the labour mobility scheme, seasonal workers, and RSE rose by 68% to $475.5 million in 2024, thanks to Australia and New Zealand for offering the opportunity. Remittances have become the third foreign exchange earner for the country after logging and cocoa exports.
Monetary Sector
Developments in the monetary sector also point to sustained growth, with broad money rising by 4 percent to $6.4 billion. Private sector credit grew by 5 percent to $2.9 billion during the year.
Fiscal
With respect to the government’s finances, the fiscal deficit narrowed to 2% of GDP (i.e., $282 million) last year, compared to 7% of GDP ($950 million) in 2023. This improvement was due to improved tax revenue and development spending. Government debt increased to 22% of GDP, reflecting additional external borrowings for infrastructure projects.
Let me now return to today’s theme: “Building the future we want through determination with clear goals and a shared ownership that calls for urgent action to deliver excellence.”
The Pacific Games showed us what we are capable of when we have a clear vision, when we take ownership, when we are determined, and when we act with urgency. The same formula can be applied to our economic future.
We need:
- Clear national goals that are ambitious, measurable, and inclusive;
- Shared ownership across Government, the private sector, NGOs, communities, and individuals;
- Unwavering dedication to the goals we set, and;
- A collective urgency that says: “We cannot wait; we must act now.”
The Pacific Games didn’t just happen because one Ministry worked in isolation. It happened because everyone — from the government to the private sector to the man and woman on the street — played their part. It’s a model we can emulate.
So today, I challenge all of us:
Let’s capture that spirit. Let’s define the future we want and work collectively, tirelessly, urgently to make it a reality.
CBSI’s commitment
At the Central Bank, we stand ready to support this national effort. We will continue to maintain macroeconomic stability, advocate for sound economic management, and foster financial sector development to underpin broad-based economic growth.
Moreover, we will continue to work closely with all stakeholders to ensure our policies contribute towards building a resilient, inclusive, and prosperous Solomon Islands.
Conclusion
Ladies and gentlemen, let me conclude by reiterating:
We stand at a crossroads. The road ahead will not be easy. It will demand the same clarity of purpose, the same ownership, the same determination, and the same urgency that powered us through the Pacific Games.
The future we want is not a distant dream. It is a choice we make today, and every day going forward. Let us choose it — together.
Thank you, and God Bless Solomon Islands.
