Today is the first day of the New Year (2023) and I ponder about the Solomon Islands economy and return to growth this year.
Reports that I have read indicate a massive increase in tourists arrivals in Fiji and better tourist arrival figures in both Tonga and Vanuatu, but from all accounts the tourist trade is still rather sluggish at home, and I question why this should be the case?
Fitch Solutions reported on the SI in this report and I quote.
“We expect that after three years of contraction between 2020 and 2022, the economy of the Solomon Islands will finally record an expansion in 2023. We forecast real GDP growth of 3.5%.
“The recovery will be driven by a continued loosening of Covid-related social restrictions and a boost to investment as the country hosts the 2023 Pacific Games and donors provide financial support for large-scale infrastructure projects.
“However, risks are tilted to the downside. Continued economic sluggishness in Mainland China, a key source of trade for the Solomon Islands, could weigh more heavily on exports than we are currently.”
End of quote.
Comment
In China there is concern over a rise in a return to Covid-19 cases and countries such as Australia, India, Malaysia, and the Unites States have brought in strict Covid testing measures for arriving tourists and visitors from China. It is understood Japan and the United Kingdom are two other countries already considering similar Covid tests for Chinese visitors.
In the Solomon Islands, the Opposition Leader has also raised the alarm about the prospect of Chinese visitors possibly arriving in the country suffering from Covid-19, a matter that should be of concern to the MHMS.
One must hope the local tourist industry will pick up soon to match or outstrip what is now occurring in Fiji, the Chinese economy will recover to see trade and investment locally and a growth figure of 3.5 % as forecast by Fitch will be realized.
It would be good to get a reaction on the economic forecast for the country and maybe this brief letter could see that occur.
Yours sincerely
Frank Short
