Solomon Islands Should Advance Reforms to Drive Investment– ADB
SYDNEY, AUSTRALIA – Further reforms to Solomon Islands business environment are needed to attract investment that will diversify the economy and grow the private sector, according to an Asian Development Bank (ADB) report released today.
The report, Continuing Reforms to Stimulate Private Investment: A Private Sector Assessment for Solomon Islands, identifies reform initiatives previously undertaken by the Government of Solomon Islands as having enhanced the country’s business environment. It recommends further measures to attract investment and promote formal sector employment that can help alleviate poverty and promote growth.
“Solomon Islands has implemented many private sector development-oriented reforms that have secured tangible benefits for its economy and people,” said Hayden Everett, Senior Country Specialist at ADB’s Pacific Liaison and Coordination Office. “Building on those achievements and making it easier for businesses to start-up and grow in the formal economy offers a sustainable way to accelerate economic growth and improve livelihoods.”
The report provides a snapshot of Solomon Islands current business environment, with a particular focus on constraints to private sector investment and growth. It proposes responses to a range of challenges affecting the environment, including improving the financial system, making state-owned enterprises more efficient, enhancing access to skilled labor, promoting women’s economic empowerment, supporting competition, and modernizing the tax system.
The recommendations aim to inform discussions on future reform initiatives, with the report noting that capacity constraints will limit responses initially available to the government and the business community.
The report was produced by the Pacific Private Sector Development Initiative (PSDI) and builds on a 2005 private sector assessment (PSA) for the country prepared by ADB. It is the first of four PSAs PSDI is producing for Pacific island countries this year. The PSAs focus on institutional and policy reforms needed to remove constraints to broad-based private sector growth.
PSDI works with ADB's 14 Pacific developing member countries to improve the enabling environment for business, and to support inclusive, private sector-led economic growth. It is cofinanced by the Government of Australia, the Government of New Zealand, and ADB.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, ADB in December 2016 will mark 50 years of development partnership in the region. It is owned by 67 members—48 from the region. In 2015, ADB assistance totaled $27.2 billion, including cofinancing of $10.7 billion.