## Solomon Islands: 2021 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Solomon Islands

_IMF Staff Country Reports, January 21, 2022_

## Source details

**Canonical URL:** [Solomon Islands: 2021 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Solomon Islands](https://www.imf.org/en/publications/cr/issues/2022/01/21/solomon-islands-2021-article-iv-consultation-press-release-staff-report-and-statement-by-512119)

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## Bibliographic details
- Published: January 21, 2022
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400200106.002

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### Overview
- Strong and timely containment measures have successfully prevented a domestic COVID-19 outbreak but have also weighed on economic activity and aggravated pre-existing socio-economic tensions.
- Following a contraction in 2020, growth is projected to recover gradually starting this year and to gain strength as containment measures are relaxed and borders re-opened.
- Elevated pandemic-related uncertainties as well as longstanding social, economic and governance challenges and vulnerability to natural disasters pose headwinds to inclusive growth.
- Despite strong external buffers, weaker fiscal position increases vulnerability to shocks, while the decline in logging weighs on fiscal revenues and growth prospects.

### Economic outlook and risks
- Growth trajectory:
  - Contraction in 2020.
  - Projected gradual recovery starting this year, with stronger growth as containment measures are relaxed and borders re-opened.
- Key risks and headwinds:
  - Elevated pandemic-related uncertainties.
  - Longstanding social, economic, and governance challenges.
  - Vulnerability to natural disasters.
  - Decline in logging affecting fiscal revenues and growth prospects.

### Fiscal and external position
- External sector:
  - Strong external buffers are in place.
- Fiscal position:
  - Weaker fiscal position increases vulnerability to shocks.
  - Decline in logging is a negative factor for fiscal revenues.

### Policy implications (as indicated in the report summary)
- Maintain effective public health containment to prevent domestic COVID-19 outbreaks while addressing the economic costs of such measures.
- Prepare for gradual reopening:
  - Policies to support recovery as containment measures are relaxed and borders re-opened.
- Strengthen resilience:
  - Address pandemic-related uncertainties, social, economic, and governance challenges, and natural disaster vulnerability to support inclusive growth.
- Fiscal management:
  - Mitigate increased vulnerability from a weaker fiscal position and respond to revenue pressures from the decline in logging.

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_Source: https://www.imf.org/en/publications/cr/issues/2022/01/21/solomon-islands-2021-article-iv-consultation-press-release-staff-report-and-statement-by-512119_