ADB's Work in Solomon Islands

Community transmission of the coronavirus disease (COVID-19), related containment restrictions, and damage from social unrest in 2021 hampered economic activity in Solomon Islands during 2022. To support economic recovery, ADB is assisting the Government of Solomon Islands to invest in transport, water supply, energy, urban infrastructure and services, education, health, and public sector management.

To date, ADB has committed 121 public sector loans, grants, and technical assistance totaling $421.9 million to Solomon Islands. Cumulative loan and grant disbursements to Solomon Islands amount to $237.35 million. These were financed by concessional ordinary capital resources, the Asian Development Fund, and other special funds. ADB’s ongoing sovereign portfolio in Solomon Islands includes 5 loans and 9 grants worth $160.8 million.

In 2022, ADB approved a $3-million grant to prepare the Honiara Sustainable Solid Waste Management Project, and a $5-million concessional loan and $5-million grant for Subprogram 1 of the Fiscal and Economic Recovery Program to support policy reforms and economic recovery.

In 2021, ADB approved a multitranche financing facility totaling $74.5 million in grants and $74.4 million in loans for the Land and Maritime Connectivity Project (LMCP) to construct roads and wharves. A grant of $6 million for the Transport Sector Project Development Facility finances the design and implementation readiness of LMCP. ADB also approved a $5.5-million grant and $10 million in cofinancing from Australia and New Zealand for the Domestic Resource Mobilization Project to support tax reform. Additional financing of $5 million from the Global Environment Facility has helped scale up the scope of the Urban Water Supply and Sanitation Sector Project (UWSSP).

In 2019, ADB committed a $12-million grant and $18 million in concessional financing to support implementation of the Tina River Hydropower Project alongside other cofinanciers including the Government of Australia and the World Bank. The project will substantially increase electricity supply generated from renewable sources in Honiara. A separate $6.79-million grant for the Solar Power Development Project supports the implementation of grid-connected solar to supply clean electricity and reduce reliance on expensive diesel imports.

In 2018, ADB committed a $3-million grant for preparing the UWSSP. This project readiness financing led to the approval of $37 million in loans and grants for the actual project in 2019. The project is now helping improve the efficiency, accessibility, and sustainability of safe water and sanitation in urban and peri-urban areas of Solomon Islands.

The Higher Education in the Pacific Investment Program supports the expansion of the University of South Pacific campus in Solomon Islands. The program is constructing a new campus and will enhance technology-based distance learning programs.

Children play in a beach on the outskirts of Honiara, Solomon Islands, June 2015. Photo: Luis Ascui/ADB

Operational Challenges. Solomon Islands shares common features with other small island developing states, such as large portions of the population living far from major markets, weak transport infrastructure, high transport costs, irregular transport services, and vulnerability to exogenous economic shocks and the impacts of climate change. Creating an environment that fosters inclusive and environmentally sustainable growth remains a challenge, considering that the country has a small domestic market, narrow economic base, and low economic diversification based on agricultural and unsustainable logging as its primary export industry. In 2022, economic activity was hampered by COVID-19 community transmission and government-imposed trade and travel restrictions that slowed down project implementation. The country continues to exhibit characteristics of a fragile state, with occasional incidents of civil unrest.

Knowledge Work

Solomon Islands continues to face capacity constraints and knowledge gaps affecting public sector performance, private sector development, social and environment safeguards, and gender equality. In 2022, the ADB-supported Pacific Private Sector Development Initiative published several reports including Reopening Borders to Tourism in Pacific Island Countries: Key Lessons and Guidance, which features lessons from Solomon Islands, and A Secure Retirement: Leveling the Playing Field for Women in the Pacific, which discusses women’s access to superannuation in Solomon Islands. The ADB-supported Pacific Region Infrastructure Facility undertook a study titled Enhancing Procurement Practice and Local Content in Pacific Infrastructure that includes a review of infrastructure procurement practices in the Solomon Islands.

  ADB Projects in Solomon Islands Project data sheets for loans, grants, TAs

Future Directions

ADB’s planned support for Solomon Islands aligns with the government’s strategic focus on increased infrastructure development, prudent financial management, affordable energy, and strengthening essential health and education services. Investments in road and maritime infrastructure will enhance connectivity and spur economic activity. Planned interventions in sustainable solid waste management will increase quality of life in the country. Support to improve public financial management practices will contribute to economic recovery and enhanced productivity. Investments in renewable energy will deliver cheaper, more reliable, and cleaner power. Resilience to disasters triggered by natural hazards and health shocks will improve through the establishment of disaster-contingent financing. Investments in social infrastructure will enhance health services, and a planned education sector project will support climate-smart citizens and increase students’ employability.

Last updated: 4 May 2023