There are two articles in the Island Sun today relating to the government’s economic stimulous package which tend to highlight the challenges and advantages posed by the ESP scheme
I will quote both reports.
When COVID-19 brought the biggest economic crisis in a generation the government responded with an equally unprecedented package of funding – it put $309 million into the economic stimulus package (ESP).
Fifteen months on some farmers are happy while others are asking why they didn’t see any of the money.
A big portion of the stimulus package – $70 million – was allocated to agriculture. This included famers growing noni, kava, cassava, taro, potato, coconut, cocoa and copra.
According to the Permanent Secretary of the Ministry of Finance and Treasury and chairman of the oversight committee, McKinnie Dentana said the productive and resource sector is a challenging component of the whole stimulus package arrangement.
“It’s challenging because we opened it for people to apply in relation to their small projects and that takes a longer period to complete,” he told Island Sun in an interview.
While the evaluation and monitoring phase of the project is still being carried out on the implementation and impact of the funds to recipients, some communities in the country are counting their blessings and others are wondering how they missed out on such a lifeline in these trying times.
For farmers on Aitolo village, Malaita Province the Economic Stimulus Package helped expand their flourishing kava gardens in their community.
To them, the government assistance could not have come at a better time. The kava revolution on Malaita is booming and the creation of wealth in the local community in Aitolo are realised 10 years from when the first kava was planted on these rugged parts of the Island.
The Aitolo Self-Reliance Association was set up after applying for assistance under the stimulus funding in July 2020.
According to Association Secretary, Lesley Sanga, the initial application was for $30,000 but only $12,000 was allocated under the scheme.
He said the funds were made to purchase tools for the 30 farmers making up the association.
Mr. Sanga said the tools helped expand existing kava gardens for these farmers.
Walter Ara, a long-time kava farmer and member of the Association said with tools acquired he was able to expand his garden.
“I now have 2000 kava plants, and was able to expand the past year,” He added.
Mr Ara began his kava farm back in 2011. So far, he has engaged in six harvests, earning enough money to build three permanent houses in his village.
According to Mr. Sanga, the Association is on the right track in terms of its development aspirations.
While the community on Aitolo are fortunate, other farmers around Malaita felt that due to their remoteness, schemes such as the stimulus package are un-heard of.
Silas Su’ufua, from Gwounafou village, East Malaita can only dream of such a funding. He said there were no awareness done to his part of the Island about the availability of such a fund.
“We never heard about the ESP, but we too need some form of assistance to help us on our farms,” the softly spoken father told Island Sun after selling his Kava products in Auki.
Senior Agriculture Officer from the Malaita Agriculture Office Patrick Maesuba said over 100 recipients have benefited from the funding on Malaita.
He said the only issue is they were not part of the implementation process of the funding, hence would not know if the funds have benefited communities on the Island.
“Such a funding should come through the Ministry and more importantly the provincial office, as we know who the active farmers on the field are, and will identify them.
“The government did not see those on the ground, it is the agriculture staff who go around the province and interact with farmers.
But Permanent Secretary, McKinnie Dentana said the Stimulus Package has saved the country from further deterioration over the past year as COVID-19 closed borders and disrupted economic activity.
He said the ESP is implemented in short term, just like other stimulus packages implemented by countries around the world.
“It should be a quick urgent government measure to ensure economic activity remains stable during the crisis,” he emphasised.
According to the Central Bank of Solomon Islands Governor, Dr Luke Forau the country has yet to realise the economic benefits of the Economic Stimulus Package to the economy.
He said as far as export commodities go, only copra has increased exports in the past financial year.
“All other other export commodities declined, so I suppose the stimulus package on the cCopra industry has worked, especially when they subsidized the copra freight,” he said when addressing local Journalists around June this year.
Mr Forau looks forward to the monitoring and evaluation report, adding it may shed light on the impacts of the stimulus package on the economy.
Permanent Secretary Dentana further explained that in the productive and resources sector the government targeted copra, cocoa and timber as in the Solomon Islands trade is still operating and export is continuing.
“But people do not have money to participate to bring in their product to the market to be exported, this goes for kava as well.
“The assistance can see farmers turn their resources into money for them to use during the crisis and for export purposes to help our bilateral trade,” he explained.
A second Economic Stimulus Package (ESP) is possible depending on the outcome of monitoring and evaluation of the effectiveness of the current ESP payments.
Permanent Secretary of the Ministry of Finance and Treasury, McKinnie Dentana told Island Sun future payments would likely be restricted to bigger recipients such as exporters rather than to small farmers or business-owners.
In the first phase of the ESP hundreds of farmers and other micro- and small-businesspeople benefited from funding for practical business inputs such as tools or planting material.
In July 2020, $124 million was allocated for immediate measures to help these businesses cope with the economic impact of the COVID-19 pandemic, including $70 million for rural production, $44 million for forestry, fisheries and tourism businesses and $10 million for assistance through the Development Bank of Solomon Islands.
Further money was made available through Members of Parliament, a total of $42 million dollars.
The payments were due to be completed by July this year.
Mr Dentana told Island Sun that the ministry of Treasury and Finance will need to see the report of the monitoring and evaluation phase of the payments before deciding on any future initiatives.
“We need to see how faithful people who receive our support are, there are some genuine recipients and some are not that genuine.
But he said any focus in the future should look at bigger players such as companies exporting kava, cocoa, foods, vegetables and cassava.
“These people are easy for us to get information (on), not like micro individual recipients which is challenging.
“Our export (income) goes back to rural people who bring their products for export, the government should only look at issues such as subsidy which it did on copra,” Mr Dentana added
The Permanent Secretary said the monitoring and evaluation report could be ready by the end of this month or in November.
Among those that have supported calls for a second round of stimulus assistance include local exporter Varivao Holdings.
According to General Manager, Benjamin Hageria the economic stimulus package is a lifeline to companies during the pandemic.
Varivao was among the larger local companies that benefited from the stimulus package and according to Hageria, the money was used to buy kava from locals to export.
Despite being provided a lifeline, the company only received two-thirds of the one million dollars it applied for under the stimulus funding.
“We have faced a lot of challenges and we were not able to go further on kava production, hence any similar assistance from the government as suggested by Opposition leader Matthew Wale recently is welcome,” he added
Meanwhile, the Permanent Secretary said a number of ESP recipients from the public have submitted their reports on the implementation of the ESP, including some of the exporters of copra, cocoa, timber and kava.
“A total of five Members of Parliament have also submitted their reports,” Mr Dentana said during his interview with Island Sun.
Apart from the report on the monitoring and evaluation of the Economic Stimulus Package, an audit of the whole funding package will be carried out as well.
The results will feed into preparations for the 2022 budget, which were launched last week by the Prime Minister, Manasseh Sogavare.
Mr Sogavare said the Government will continue to prioritise the productive and resources sectors in the 2022 budget as these two sectors are major drivers and enablers of economic growth.
“This does not mean that other sectors are not important, they will continue to be supported,” he said.
Under the Productive Sector, Prime Minister Sogavare said the Government is aiming to support infrastructure and communication investments, support food security, create employment and entrepreneurship to empower youth and women.
The Ministry of Finance and Treasury and the ESP Committee of which McKinnie Dentana is Chairman will have important input.
“With the Information from the team I can recommend to government whether to roll out another ESP scheme or not,” Mr Dentana said
End of quotes.
Yours sincerely
Frank Short
