An Island Sun newspaper article, today, Thursday, reports the Government believes that the $360 million Economic Stimulus Package funding has helped Solomon Islands and its people avoid the worst economic impacts of COVID-19.
Quoting the full story it read.
When the pandemic closed international borders, shutting down tourism and disrupting exports, it was widely seen as one of the biggest economic challenges the country has ever faced.
Permanent Secretary of the Ministry of Finance and Treasury, McKinnie Dentana said it would be foolish to say the country might recover with the funding set aside under the package, however, the government’s policy is stabilizing the economy.
“This is to ensure the economy would not deteriorate but stabilized… for the people.
“Based on the scenario we have seen; we are not really deteriorating like what we expected.
He emphasized that small projects and businesses needed to have the capacity to continue and people needed to hold cash money in their hands as the COVID economic crisis hit.
“What is important is the government will continue to earn from the taxes spent by the people,” he added.
The country has faced hardships over the past year with provisional employment data from the National Provident Fund (NPF) showing that the total number of people employed fell 6.0% to 57,028 by end of 2020.
The Economic Stimulus Package was an ambitious fiscal measure to address the negative impacts of the pandemic on the economy
It focused on three key strategic policy objectives:
1) to ensure business continuity and prevent the economy from declining further;
2) to immediately boost economic recovery by encouraging income-generating activities and employment.
3) to promote medium to long term growth
Despite a gloomy prediction at the end of last year about the local economy, PS Dentana said our economy was able to cushion the impact of the pandemic and maintain its stability.
“We did not only pump money to our local economy through the stimulus package but also other Covid-19 funds from the National Government generated from the quarantine centers.
“The donors have praised us for well managing our Economy we are not really deteriorating
“Business continues, trading continues, especially export and import is continuing….and commodity continues.
Tuna a bright spot, despite some struggles
Companies that have benefited from the Economic Stimulus Package (ESP) include SolTuna Limited, the multi-million-dollar company employing more than 2,000 Solomon Islanders.
Soluna received $5 million from the package.
Marketing Manager, Kenwood Harry told island Sun he understands that the $5 million is the government’s commitment in terms of supporting Soltuna and food security for the country.
He said the money helped with some of the company’s costs, but not its full operation.
“I would say …it is not that sufficient but at least we use it for some of our operations inside the company.
Mr. Harry said despite the challenges posed by the pandemic, Soltuna has been able to maintain production at its processing plant.
“Our operation …operated as normal as there is no community transmission recorded here in the Solomons.
Soltuna worker, Sabrina Peli who is employed at the Soltuna’s cannery at the township of Noro is glad that while other industries have suffered adverse impacts as a result of Covid-19, she and her co-workers have been able to retain their jobs.
Ms. Peli said people like her are able to find steady and paid jobs at the company.
“We have many relatives and family who were laid off during the Covid-19 crisis, however, we are thankful that despite that, we are able to support our family as we still have our jobs,” she told Island Sun.
Despite the mainly good news, the tuna industry has not escaped problems facing all importers and exporters.
“We are …affected by COVID-19, especially logistics where the local supply chain is really affected,” Mr. Harry said.
Freight and export challenges
Soluna has experienced delays in procuring essential materials for its cannery.
“This is we because we only have limited flights coming, due to closure of the (international) border,” Mr. Harry said.
Vessels arriving at Noro port have also been delayed, including due to quarantine protocols required before berthing he added.
Soluna has been quick to respond to new conditions.
“We managed to map out our contingency plan on how we as the company ordered the materials, despite the delay (which) is beyond our control,” Mr. Harry explained.
Shipping delays have also affected the volume of tuna exported to neighboring Pacific Island Countries.
However, within Solomon Islands demand for canned fish is still high.
Mr. Harry said local strong demand combined with the absence of COVID-19 in the country, has resulted in Soltuna being able to maintain production, employment, and surprising normality.
“The company got through this pandemic and felt the pinch, but it is still surviving,” he concluded.
The future of the ESP
In July last year, a total of $309 million was allocated for the Economic Stimulus Package to help ordinary people and the economy cope with the impact of COVID-19.
Small farmers and business people were allocated $124 for rural production, forestry, fisheries, and tourism businesses. Infrastructure projects, the Development Bank of Solomon Islands, and companies in essential industries, such as airlines and water supply, also received funding, as did MPs.
Much of the funding was intended as immediate initiatives to be spent within a year.
Back then, few people would have expected that more than a year later borders would still be closed and industries suffering.
After such a huge investment, the Ministry of Treasury and Finance (MoF) is now assessing the impact of the first ESP measures, with the report by its Monitoring and Evaluation Committee expected later this month.
MoFT Permanent Secretary Dentana has said a second economic stimulus package is possible but will depend on the findings of the Committee.
With borders remaining closed and vaccination rates not yet at levels required for re-opening, it will be some time before business gets back to normal.
And before that, there are likely to be new challenges.
Mr. Harry says Soltuna is ready for when COVID-19 reaches our shores.
“Should there be any cases recorded we have a plan in place for us to follow so that our work is not disrupted,” Mr. Harry said.
“For now our contingency plan is not active ….not until we record any community transmission.
“Then we will activate our plan to not disrupt our production and our economy, as well.
End of quote.
Yours sincerely
Frank Short
