Solomon Islands Development Policy Operation-2

closed

Solomon Islands are a fragile, post-conflict small island state and the poorest in the Pacific when measured in terms of Gross Domestic Product, or GDP per capita. Most of the population is dispersed across rural areas of the archipelago, where they largely depend on subsistence agriculture. This caps food poverty rates, but exposes the population to environmental shocks. Poverty rates are higher in urban areas, where traditional safety nets are weaker and unemployment rates are high. A former British protectorate, the country became independent in 1978 and enjoyed twenty years of moderate but sustained economic growth and improvement in social indicators. A low-level conflict between 1998 and 2003, known as 'the tension,' brought the formal economy and many state functions to a halt. Real GDP per capita, which had been slowly eroding between 1996 and 1999, fell sharply between 2000 and 2002. An Australian-led and financed regional peacekeeping mission, the Regional Assistance Mission to Solomon Islands (RAMSI), stopped the violence and rapidly restored order and basic state functions, particularly in finance. The country has subsequently enjoyed a fairly good security situation, interrupted only by short-lived but destructive riots in 2006, mainly in the capital Honiara. RAMSI presently retains a police and military presence, as well as a large corps of civilians in advisory or in line functions, notably in the Ministry of Finance and Treasury (MoFT). Given the overall stability in the country, RAMSI will undergo a significant transition in mid-2013. Although an extensive police presence will remain to build the capacity of the Royal Solomon Islands police force, the bulk of the military component is scheduled to depart, and the advisory support will transition to bilateral programs.