14 March 2019
A realistic glimpse into Solomons future when logging earnings dry up.
Tourism instead of log exports perhaps?
A prospective candidate in the forthcoming general election in the Solomon Islands, scheduled for 3 April 2019, has been talking of the logging industry and, pointedly, raised the important issue of “What’s next after logging comes to an inevitable end?”
Quoting from an article in today’s Island Sun newspaper the contending candidate mentioned the following issues (quote)
“People must understand that almost 70 percent of the foreign earning of the country’s economy depends on the US Dollar that comes from logging.”
“About 42 percent of revenue government earns also comes from logging when logging companies pay their custom duty.”
“Of the 80,000 jobs in the economy, 30,000 come from logging. And that showed logging was a huge contributor to unemployment issue in the country.”
“As well as looking at revenue, logging was a big contributor and on foreign reserves logging is the only single largest contributor.”
“Making foreign reserves are very important as it allows the country to import goods from overseas.”
“You must understand that government’s revenue is paid for all public services in the country.”
“So logging has made a big contribution to government ability to provide services for the country.”
“The numbers of jobs logging creates and provides are direct jobs and there are also indirect jobs providing services to logging.”
“Therefore, maybe another 5,000 to 6,000 jobs in our economy that indirectly dependent on logging,”
“The problem is logging is coming to an end and there will be difficulties ahead for the country in the absence of the industry.”
“Over the past five years almost three million cubic metres of round logs produced per year by logging industry.”
“This is unsustainable, but we continue to harvest our forest,”
“Due to that a number of advices were issued by the International Monetary Fund (IMF) to the government of Solomon Islands to reduce the number of cubic metres of logs exported.”
He said in response to that, last year the government agreed to reduce the harvest to 700,000 cubic metres per year.
“The rationale (is) if we do not comply with the advice, the IMF will blacklist our central bank and we won’t transact international payments.”
“And if they do so, it will make it difficult for our central bank to trade and receive US dollar overseas,”
However, he said if the 2.3 million cubic metres were removed from the total cubic metres of log exported per year, it will badly affect the country’s economy.
That will definitely result in a huge cut in the foreign reserve, the national revenue and about 30 000 direct jobs comes from logging will also cut.
“By looking at these facts you know what life would be in the future. And life is going to get more difficult ahead.”
“Because population increases, resources were unsustainably harvested and land remains the same.”
“And if logging is gone our economy will fall. Government revenue will significantly go down and US dollars coming into the country will also go down.”
It has to be said that the Solomon Islands government is making every effort to encourage tourism ahead of the run-down in log exports and the logging industry generally.
One logging company is already diversifying into manufacturing veneer and soon plywood products while timber remains available and encouraging re-forestation.