In today’s Island Sun newspaper it is claimed the SI Opposition Leader Hon Matthew Wale is urging the government to consider a second stimulus package, based on the persistence of hardships felt by families and households throughout the country.
Quoting from the newspaper article, it said.
Mr. Wale explained that a second Economic Stimulus Package (ESP) is needed due to the hardships faced by families and households to make ends meet, and even simply to put food on the table on a daily basis, let alone meet other basic needs such as clothing, water, electricity, education, health, and transportation.
This situation is particularly hard in urban centres.
The Government introduced a covid-19 $319 million ESP mid-last year to address the economic impacts faced by businesses, farmers and individuals.
Speaking at the special adjournment motion in Parliament on Monday, Mr.Wale asked “What lessons has the government learnt from the ESP?
“A successful ESP must be inclusive in the benefits that flow on from it in the broader economy,” he said.
Mr.Wale said the majority of Solomon Islanders live at the bottom end of the economy in a ‘hand to mouth’ situation.
He said a successful ESP must aim to ensure its flow-on benefits reach those especially at the lowest margins.
As such, Mr.Wale said there is need for another ESP.
“However, this one must be better targeted and focused and funded to around SBD2bn, or 20% of our pre-covid GDP.
“The government must seek donor grants support for such an ESP. we shouldn’t have to borrow for it,” he said.
“But we need it desperately.
“Government announced that it is being prudent and responsible in its fiscal policy and management of public finances,” he said.
“But I contend that the greater duty of care is to the majority of the Solomon Islands population who have been driven further into poverty and economic hardship by covid.
“Government’s responsibility to them must trump all else. It is not an argument to be fiscally irresponsible, but to be proactive and assertive with donors,” he said.
Prime Minister Manasseh Sogavare said this is a matter he will leave it to Cabinet and advice from Central Bank of Solomon Islands and Ministry of Finance and Treasury to advise government on it.
Mr.Sogavare said the government is rolling out to rural areas with some programmes that never reach them.
He said one thirds of the development budget goes through Members of Parliament.
“If we use it good it should help in stimulating the rural economy,” he said.
Prime Minister Sogavare said the suggestion to look at another ESP that is 20 percent of Gross Domestic Product is right in economic arguments.
However, he said the government needs to look at national capacity to do that.
“When comes to liquidity, the banks will have so much liquidity.
“And State-Owned Enterprises will find it difficult to deposit money because the banks will refuse,” he said.
End of quote.
Source. Island Sun newspaper.
Yours sincerely
Frank Short
