Gov’t, private sector connectivity vital for economic growth, says PM - Solomon Star News

Gov’t, private sector connectivity vital for economic growth, says PM

28 March 2014

PRIME Minister Gordon Darcy Lilo says while his Government is aware and conscious of the demands for economic development; importantly, economic growth must be linked and relevant to the human development of the citizens of this nation.

Mr Lilo highlighted this when officially opening a one day forum on the Solomon Islands Economic Growth held at the Heritage Park Hotel Wednesday.

During the occasion the Prime Minister discussed the concepts and ideas, models and policies that would result in tangible practical developmental projects.

Prime Minister Lilo said the functions of each economic actor which includes the government, the public sector, the private sector and the general populace is a critical point for consideration.

He said the public sector and the government both have direct and indirect influence on economic growth, as a major consumer, in the case of the public service, but also in terms of developing policy, in the case of Government.

However, Mr Lilo said in the Solomon Islands the relationship between the private sector and the government must continue to be developed, as this is in itself critical in establishing and forging the connectivity of the enabling economic environment, the achievement of mutual economic goals and ideals, and in enhancing existing standards by which we currently measure our rate of economic growth.

“Ideally, the government must focus on managing the public sector, on developing appropriate policy and ensuring that resource is properly channeled through the appropriate instruments of delivery. Similarly the private sector must develop its business models with a desire to achieve real growth,” he said.

The Prime Minister adds this is what is critical for the Economic Growth Forum, that would translate nominal economic growth into real and substantive growth in the lives of the people.

Resource Management strategy
Mr Lilo said the domestic economic outcomes of the Solomon Islands depends on the domestic investments and  production in forestry, minerals, palm oil, copra and coconut oil, cocoa and other commodities including the production of coffee, kava, vanilla and sea weed.

He said as a result of the abundance of natural resources, including rich tuna fishing grounds, known deposits of gold in Guadalcanal and Western Provinces and nickel deposits on Isabel islands, and the potential for increased tourism, there are prospective alternative drivers for growth in Solomon Islands.

“In the short to medium term the agricultural sector, which accounts for around a third of gross domestic product and embraces more than 80 percent of the total population, is likely to provide the basis for broad based economic growth,” the Prime Minister said.

However, he said the growth in rural production is unlikely to be sufficient on its own.

Therefore, encouraging investment by removing administrative barriers to business development, developing national and provincial infrastructure (including transport infrastructure), reforming state owned enterprises, strengthening the financial sector and developing the provincial economies is vital to ensuring acceptable levels of broad based growth.

Infrastructural development
Infrastructural development is a significant measures of the rate of economic growth in this country; therefore, it is important to balance the need for the infrastructure against what we may term as a proper and appropriate form of infrastructure, Prime Minister Lilo highlighted.

He said the promotion of proper investment into infrastructure development, with the appropriate insight and understanding to the context and the potential of specific places is absolutely critical.

“When we consider the example of transport infrastructure for example, we should explore land and road, shipping as well as air transport infrastructure.

“We need to develop innovative business management and strategies in infrastructure development,” he said.

Thus, the Prime Minister said development assistance must be compatible to the actual needs and expectation of the infrastructural needs of the people.

“Government’s obligations includes ensuring that deliverables will meet the standards and expectations of all stakeholders and more significantly, will assist in increasing the standard of measurement of growth expected,” he said.

Customary Lands Reform
During the occasion, the Prime Minister also highlighted important concepts relating to the link between economic growth and the customary land reform.

Mr Lilo said land directly relates to the level of development that can occur with respect to the building of roads, airports and even in terms of providing shipping services.

He said improving access to the economic potential of land and resolving lingering tensions over ownership and land title are also essential requirements of any long term growth strategy.

“Admittedly, much is to be desired in terms of a comprehensive land reform capable of addressing the most fundamental land related issues in the Solomon Islands.

“And NCRA government has always been committed to resolving this long standing issue, so much so that we are confident that the foundational work has been laid by our government,” the Prime Minister said.