Recent developments in the Solomon Islands economy

Underlying ethnic tensions erupting in Solomon Islands in late 1998 resulted in considerable damage to the people, the economy and the reputation of Solomon Islands, and led to armed intervention in government on 5 June 2000. The coalition government elected in 1997 had made some headway in repairing the damage to the economy caused by poor management during much of the 1990s, but was unable to resolve long-standing internal problems. This article sets out a range of economic issues that affected Solomon Islands during most of the 1990s and some of the progress made. The Asian financial crisis of 1997 severely harmed the Solomon Islands? economy but the effect of ethnic tensions is more severe. Solomon Islands Plantation Limited, after twenty five years of successful economic operations in Solomon Islands has withdrawn. Negative real economic growth is expected. It is too early to determine exactly what effect the June 2000 actions will have on the extent of this decline