What Solomon Islands needs to Develop? - Solomon Star News

What Solomon Islands needs to Develop?

17 March 2016

I usually remain inconclusive on a question – Is the Solomon Islands a rich country or a poor country? I can say, it’s rich, but it’s poor too, or, the Solomon Islands is as a rich country of deprived people.  Let me explain, why?

It is poor, as the United Nations classified it as a Least Developed Country (LDC), having very low per capita income, low life expectancy and low level of education, along with many other low development indicators, including gender inequality, high unemployment rate, food insecurity, and weak business environment hampering industrialization and investment to prosper, among others.

But, when I look around, I find it very rich too. Those riches are basically huge natural resources. In particular, dense forests, oceans full of foods and other resources, mines, fertile lands for farming and people who can work hard in harsh conditions.

These resources, if utilised properly and wisely, can make this country a developed country in no longer time. The country can accelerate its economic growth in a way that advances the wellbeing of people, by reducing or eradicating poverty and hunger and improving health and education of people.

But, the big question is -- how to use available resources wisely and properly.

Like many other development practitioners, I am always impressed with the SINGAPORE STORY. Singapore, a tiny island state, transformed from a third world nation to one of the most developed countries of the world within just a few decades.

There are some interesting lessons in the book “From Third World to First: The Singapore Story”. The book was written by Lee Kuan Yew, the visionary statesman of Singapore who transformed Singapore from a sleepy port into an economic powerhouse and modern society only in three decades. How Singapore, a country that granted independence few  year earlier than the Solomon Islands, successfully transformed itself  from the former British colonial trading post to one of the world’s most advanced countries, with not only the world's number one airline, best airport, and busiest port of trade, but also one of the world's highest per capita real income?

One of Singapore’s renowned diplomats, Kishore Mahbubani, professor at the Lee Kuan Yew School of Public Policy at the National University of Singapore, delivered a lecture in East Timor about what lessons other developing countries might draw from the city-state’s success. The ten most important facts presented are summarised below.

First, Singapore got lucky, blessed with good founding fathers to guide the country. Therefore, we can draw a lesson that a constructive and decisive leadership is needed to develop.

Second, Mahbubani stated that the city-state cultivated a culture of meritocracy and ensured that officers were recruited and promoted by merit and were adequately paid. Mahbubani quotes Lee himself as saying, “A strong political leadership needs a neutral, efficient, honest civil service.”

Third, the country’s leaders used pragmatism as their guiding philosophy. Inspired from Japanese leaders, Singaporean leaders spent significant time trying to study, copy and adapt best practices from around the world.

Fourth, Singapore rightly realizes that small states cannot afford to make enemies, therefore, managed its relationships adroitly in order to preserve peace and prosperity.

Fifth, Singapore’s leaders focused on starting with small wins. Initially, Mahbubani says, achieving development might not mean sweeping reform, but smaller steps that have a huge impact on the everyday lives of the people.

Sixth, Singapore relied not on foreign aid, but on trade and investment to achieve its development goals.

Seventh, Singapore had an inclusive policy on ethnic groups. To accommodate the ethnic groups, the country has four official languages: English, Mandarin, Malay and Tamil. There is also a balance struck in school between having English as a common language of instruction to enable communication and allowing groups to learn their own ‘mother tongue.’

Eighth, Singapore’s leaders believed in thinking long-term. Here, Mahbubani uses the example of Singapore’s need to secure its water supply. Even though the city-state had signed a 100-year water agreement with Malaysia in 1961, its leaders acknowledged the inherent vulnerability of relying on its neighbor for such a critical resource. Therefore, they invested in ways to get their own sources of water, including through reservoirs, desalination plants and water reclamation facilities.

Ninth, Singapore avoided populist measures. It is argued that the aversion of the country’s leaders to the welfare state, believing that ‘handouts’ undermined self-reliance and fostered a dependence on the state, paid off. However, the country has invested in the welfare of its people in other ways, including through high-quality education and healthcare, affordable public housing and public transportation, and a compulsory saving fund for workers.

Tenth, Singapore’s leaders were honest and not corrupt. Mahbubani acknowledges that this might be the most challenging thing to achieve in his list. Honesty in a country makes people feel confident in their leaders and gives investors the peace of mind they need to do business.

Mahbubani acknowledged that some of these lessons might be difficult to replicate, and suggested that any principles need to be adapted to the local context.

In my view, if not all, few of those mentioned above are necessary for Solomon Islands to transform. And, I don’t think that the Solomon Islands can’t replicate any of these ten Singapore success factors, if needed.

Let’s also ponder economic development theories. Conventional economic theory suggests that a country need to grow faster and distribute benefits of economic growth in equitable manner. Economic growth is the prerequisite, but should be sustainable and equitable -- growth that translates into the lives of masses.

To sustain growth that improves the lives of people, Solomon Islands needs an economic transformation that taps into other riches -- its fertile land, and creating much needed jobs through strengthening forward and backward linkages in key industries like forest based industries, fisheries, mining, tourism. At the same time maintaining energy and ingenuity of its people also warranted.

What Solomon Islands will need to achieve such a transformation? More finance (money)? More aid? More trade and investment? More educated people (human resources)? Something else? Or all those mentioned here and few more.

There are many empirical economic growth theories that explain the sources of economic growth. Those can be summarized as land, natural resources, labour, capital, technology/innovation, human resources, business environment, etc. A country definitely needs to explore all these sources of growth.

Some of these (particularly natural resources) are already in existence here in Solomon Islands, while some others need to be created. There are some obstacles to growth too. Those are basically complex land management/tenure system, access to finance, lack of capital, unfavourable business environment, weak policy environment and hostile infrastructures, among others.

Therefore, to use existing resources to accelerate growth, Solomon Islands will need to overcome these obstacles. In this situation, quality of human resources, improvements in land tenure system, capital formation, attracting foreign investment to fill the capital gaps, and creating a vibrant business environment will determine the course of development in Solomon Islands.

To conclude, the best development strategy for Solomon Islands might be: EXPLORE THE SOURCES OF GROWTH, REMOVE THE OBSTACLES AND ADAPT BEST PRACTICES FROM AROUND THE WORLD.

By Shiv Raj Bhatt
Technical Advisor at the Ministry of Foreign Affairs and External Trade