After having recorded consistent budget surpluses since 2010, the government’s fiscal position deteriorated to a balanced budget in 2015, followed by budget deficits during 2016 and 2017 due to reform slippage and a change in government priorities. Joint policy dialogue with development partners through the government-led Core Economic Working Group (CEWG) lapsed during this period.
In April 2014, prolonged heavy rainfall associated with tropical cyclone Ita caused severe flooding in the Solomon Islands’ capital, Honiara, and the surrounding Guadalcanal province on Guadalcanal island. The storm damaged or destroyed roads, bridges, houses, water supply systems, and other major infrastructure. The government declared a state disaster for Honiara and all of Guadalcanal.
At project appraisal in 2013, only around 3% of the people in the Malaita province, which had about 25% of the Solomon Islands’ national population, had access to grid electricity. Power in the provincial capital of Auki was 100% diesel-generated and so was expensive and beyond the reach of most of the local population.
On 27 May 2016, the Asian Development Bank (ADB) approved a single-tranche policy-based grant to the Solomon Islands for the Economic Growth and Fiscal Reform Program.
Solomon Islands is a large Melanesian country, composed of 6 big islands, dozens of smaller islands, and several hundreds of islets and atolls. As of 2010, about 80% of its 500,000 people lived in the rural areas, in widely dispersed villages of a few hundred people.
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