AGP Executive Report

Western Province–China ties: Western Province Premier Billy Veo met China’s ambassador in Honiara to reaffirm cooperation, with priorities including energy, Gizo water desalination and infrastructure investment, and plans for a delegation to visit China to explore trade and investment. Mining law overhaul: The Government introduced a new Mineral Resources Bill 2025 to replace the 30-year Mines and Minerals Act, putting landowners and communities at the centre through a statutory Community Development Agreement framework, stronger land access and compensation rules, and tighter environmental safeguards. Public finance update: Finance Minister Gordon Darcy Lilo told Parliament debt remains within safety limits (debt-to-GDP 27.2%), while 2025 results showed revenue of about $4.1b against spending of $5.1b and a deficit of roughly $768m. Banking push: Cabinet approved work on a new national bank with a rural bank component developed with the World Bank, aimed at expanding formal services beyond communities left out by past credit union failures. Port and transport upgrades: Honiara International Port works moved into the next phase of the International Berth 1 upgrade, while LMCP also began installing permanent traffic signs on upgraded roads to improve safety. Security and enforcement: RSIPF received a $5.5m upgraded Tactical Training Centre from Australia’s AFP, and Australia is set to hand over the Lofung border and patrol boat outpost to strengthen western maritime coordination. Economic growth outlook: Real GDP growth for 2026 was revised up to 3.5%, supported by mining, agriculture, tourism and fisheries as logging declines. Freshwater resilience: Solomon Islands launched the PacFresH2O programme to protect freshwater resources and build climate resilience with partners including GIZ, SPC and Live & Learn. Business governance dispute: Attorney-General Gabriel Suri denied an ongoing business relationship controversy, saying his Panatina Chemists directorship ended in 2018 and his name should have been removed from company records.

Mining law overhaul: The Government introduced the Mineral Resources Bill 2025 to modernise mining rules, make Community Development Agreements (CDAs) a statutory requirement, strengthen landowner rights, and tighten environmental safeguards. Public finance: Finance Minister Gordon Darcy Lilo told Parliament debt is still within “fiscal safety” (debt-to-GDP 27.2% vs a 35% threshold) and said 2025 saw about $4.1b revenue against $5.1b spending. National bank push: Cabinet approved work on a new national bank with a rural bank component in partnership with the World Bank, aimed at bringing banking to communities left out after credit union failures. Port and roads: Honiara International Port upgrade moved into the next phase for International Berth 1, while MID began installing traffic signs on upgraded roads to improve safety. Security and policing: RSIPF received a $5.5m upgraded Tactical Training Centre from AFP, and Australia is set to hand over the Lofung border and patrol boat outpost. Regional economy and trade: Solomon Islands’ real GDP growth was revised to 3.5% as mining, agriculture, tourism and fisheries improve while logging declines. Energy and development: PM Wale backed plans for a regional fuel hub in Northwest Guadalcanal and discussed deeper economic cooperation with Indonesia and Thailand. Community projects: Small Malaita received SBD100,000 from China for safer sea transport via boats and an engine. Freshwater resilience: Solomon Islands launched the PacFresH2O programme to protect freshwater resources and boost climate resilience.

Timber & Jobs: Australia is partnering with Kolombangara Forest Products to train workers in heavy machinery and upgrade an early learning centre, supporting a certified sustainable timber plantation that employs about 1,000 Solomon Islanders. Economy & Budget: Finance Minister Gordon Darcy Lilo says real GDP growth is revised up to 3.5% as mining, agriculture, tourism and fisheries strengthen while logging declines; he also flagged manageable debt (debt-to-GDP 27.2%) and reported 2025 revenue of about $4.1b versus spending near $5.1b. Banking Reform: Cabinet has approved work on a new national bank with a rural bank component in partnership with the World Bank, aiming to bring banking to communities left out after past credit union failures. Mining Law Overhaul: A new Mineral Resources Bill 2025 would modernise mining rules, make Community Development Agreements statutory, strengthen landowner access and compensation, and tighten environmental safeguards. Mining Revenue vs Capital Flows: Lilo raised concerns that strong gold export earnings aren’t matched by visible capital inflows in the national accounts, prompting further review. Public Finance Scrutiny: Parliament deferred supplementary bills after required reports weren’t tabled. Infrastructure & Security: Construction is advancing on Honiara Port’s Berth 1 upgrade, while Australia will hand over the new Lofung border and patrol boat outpost to boost western maritime security. Regional Fisheries: Pacific tuna bodies are shifting toward value retention and economic development under the Vakamanu strategy. Governance & Trade: Government moves to tighten tax collection and tackle exemptions, including steps toward a VAT framework and income tax rewrites. Youth Justice: A National Youth Justice Bill is stalled as legislative priorities compete, with UNICEF-funded consultations reported as fully spent.

Media Business Shift: A look at how newsrooms are cutting back climate desks in 2026, while some media firms are finding new profit models through events, writer-linked incentives, and worker-owned structures. Pacific Diplomacy: US President Joe Biden met Pacific leaders for a second summit, promising new infrastructure funding (including undersea cable connectivity) as Washington seeks to counter China’s growing influence. Mining Law & Community Benefits: The Government introduced a Mineral Resources Bill to modernise mining rules, putting landowners and communities at the centre via statutory Community Development Agreements and stronger access, compensation, and environmental safeguards. Honiara Port Upgrade: Construction for the International Berth 1 upgrade has entered the next phase, with temporary marine works underway to support a planned 30-metre seaward extension. Public Finance & Growth: Finance Minister Gordon Darcy Lilo told Parliament GDP growth is revised to 3.5% as mining, agriculture, tourism and fisheries strengthen, while logging continues to decline; he also flagged manageable debt levels and revenue/spending figures. Rural Banking Plan: Cabinet approved work on a new National Bank with a rural banking component in partnership with the World Bank, aiming to bring formal services to communities outside commercial banking reach. Tax Reform Push: Government moves to tighten tax collection, tackle exemptions and prepare a broad-based consumption tax system including a proposed VAT. Energy Security: PM Wale outlined plans for a regional fuel hub in Northwest Guadalcanal to secure up to 12 months of supply and reduce freight costs across the Pacific. Health & Skills: The Ministry of Health is coaching frontline workers on diabetic foot wound care to reduce amputations and hospital admissions. Sports Governance: OFC welcomed FIFA’s pullback on its Forward Enterprise proposal, urging transparency and trust in football’s commercial governance. Governance Watch: Opposition questioned the Solomon Islands–US DFC deal claims and also raised conflict-of-interest concerns over the PM’s corporate links to the Attorney-General’s Panatina Chemists.

Rural finance push: Cabinet has approved work on a new National Bank, including a Rural Bank component in partnership with the World Bank, aiming to bring banking back to communities long left out of formal finance after past credit union failures. Port upgrade: Honiara International Port works have entered the next phase of the International Berth 1 upgrade, with temporary marine piling structures now being fabricated to support a planned 30-metre seaward extension under the Land and Maritime Connectivity Project. Public finance snapshot: Finance Minister Gordon Darcy Lilo told Parliament Solomon Islands’ real GDP growth is revised up to 3.5% as mining, agriculture, tourism and fisheries hold up while logging declines; he also said government revenue reached about $4.1b in 2025 against spending of about $5.1b, with debt still within a 35% debt-to-GDP safety threshold. Tax crackdown: Government moves to tighten tax collection and tackle exemptions, with plans for a broad-based consumption tax (including VAT) and a rewrite of the Income Tax Act. Energy and trade security: PM Wale says Solomon Islands plans a regional fuel hub at Aruligo (targeting up to 12 months’ supply) and Australia will hand over the new Lofung border and patrol boat outpost to strengthen the western maritime frontier. Local business and courts: The High Court ordered the Seventh-day Adventist Church to pay Xiao’s Hardware $831,000 in damages after missing a filing deadline in a land-related dispute. Regional geopolitics: Pacific unity is under strain ahead of Palau’s PIF leaders meeting, with ministers unable to agree on how to respond to China’s recent missile test. Sports governance: OFC welcomed FIFA’s withdrawal of its Forward Enterprise proposal, calling for transparency and trust in football’s commercial governance.

Small Business & Jobs: In Suva, Solomon Islands-born vendor Ratu Silivenusi Waqa is up before dawn, running a roadside food stall outside the bus station after construction work dried up—showing how self-employment can keep incomes moving even when weather cuts sales. Energy Security: Prime Minister Matthew Wale says Solomon Islands plans a major regional fuel hub at Aruligo, Northwest Guadalcanal, aiming for up to 12 months’ fuel storage and lower freight costs across the Pacific. Freshwater Resilience: The government has launched the PacFresH2O programme in Honiara to protect freshwater resources and boost climate resilience, with support from GIZ, SPC and Live & Learn. Mining Revenue Scrutiny: Finance Minister Gordon Darcy Lilo questioned why strong gold export earnings aren’t matched by visible capital inflows in the national accounts, signalling a push to examine where mining money is going. Tax Reform Push: Lilo also flagged moves to tighten tax collection, reduce exemptions and prepare a broad-based consumption tax (including a proposed VAT), alongside further changes to income tax. Parliament & Public Finance: Parliament deferred supplementary appropriation Bills after required reports weren’t tabled, while PAC hearings continue to probe donor-funded spending and other supplementary requests. Agriculture & Value Chains: Faifatala’a kava farmers are preparing a plantation-to-market plan to meet international demand, and MALD has started a pig breed improvement programme with breeding pigs arriving at KG VI Farm. Regional Cooperation: Wale met Indonesia’s envoy on deeper economic cooperation, including coconut value-add; Australia will hand over the Lofung border and patrol boat outpost to Solomon Islands on 17 August. Governance & Courts: The High Court ordered the SDA Church to pay over $831,000 in damages to a Chinese hardware business after missed court deadlines. Youth Justice: Work on the National Youth Justice Bill has stalled as legislative priorities compete, despite UNICEF-funded consultations. Sports Governance: OFC confirmed it will issue an update on FIFA’s Forward Enterprise proposal, with the Solomon Islands among the 11 member associations involved.

Regional Energy Security: Prime Minister Matthew Wale says Solomon Islands plans a major regional fuel hub at Aruligo, Northwest Guadalcanal, aiming to store up to 12 months of fuel and cut freight costs by coordinating purchases with PNG and Fiji, including possible sourcing from the US West Coast instead of Singapore. Parliament & Public Finance: Parliament deferred consideration of the 2025 and 2026 Supplementary Appropriation Bills because required reports weren’t tabled, while Finance Minister Gordon Darcy Lilo flagged concerns about weak visible capital inflows from mining despite strong gold export earnings. Tax & Revenue Reform: Lilo told Parliament the government will tighten tax collection, curb exemptions and abuse, and move toward a broad-based consumption tax (including a proposed VAT) plus further changes to the Income Tax Act. Freshwater & Climate Resilience: Solomon Islands launched the PacFresH2O Programme with support from GIZ, SPC and Live & Learn to protect freshwater resources and strengthen climate resilience across Solomon Islands and Papua New Guinea. Agriculture & Jobs: Faifatala’a kava farmers in Malaita are preparing a plantation-to-market pilot to meet international demand, while MALD’s SIART-backed Pig Breed Improvement Program has begun with breeding pigs arriving at KG VI Farm. Power & Connectivity: Reeves Envico and CE Group have started work on a 22km transmission line from Tina River to Honiara’s grid, supporting up to 15MW of renewable power. Business & Courts: The High Court ordered the Seventh-day Adventist Church to pay Xiao’s Hardware Company Limited $831,000 in business-loss damages after missing a deadline. Trade & Border: Australia will hand over the new Lofung Border and Patrol Boat Outpost in the Shortlands on 17 August to strengthen western border security and support services and economic growth.

Energy & Infrastructure: Reeves Envico and CE Group have started work on a 22-kilometre transmission line linking Tina River hydropower to Honiara’s grid, aiming to deliver up to 15MW of renewable power and cut reliance on diesel. Public Finance Oversight: The PAC questioned multiple supplementary spending items, including nearly $18.6m for provincial grants under the IEDCR (with a chart-of-accounts mismatch flagged) and $6.8m for 2025 donor-funded health services. Electricity & Hydropower Spending Scrutiny: PAC also probed SBD21.69m in advanced warrants already spent on the Tina River Hydropower project, seeking Parliament’s approval to regularise costs. Telecom Expansion: Polar Power reported $7.9m in Pacific Islands revenue since 2024 and new repeat orders for 15 more solar-hybrid systems in the Solomon Islands to support broadband rollouts. Governance & Local Development: MPGIS is pushing constituency economic growth centres nationwide, while all 50 constituencies are set for CDF audits under the Community Participatory Audit approach. Regional Diplomacy: PM Wale met Germany’s ambassador and also held talks with the g7+ secretariat, as Pacific leaders continue to manage security and climate priorities amid external pressure. Youth & Justice Funding: Work on Solomon Islands’ National Youth Justice Bill has stalled after UNICEF-funded consultations were completed, but competing legislative priorities took over.

Energy & Infrastructure: Reeves Envico and CE Group have started work on a 22-kilometre transmission line linking Tina River hydropower to Honiara’s grid, targeting up to 15MW of renewable power to cut diesel reliance. Public Finance Watch: The Public Accounts Committee questioned multiple government rental deals, including a $1.85m request for the Ministry of Lands and a separate $100,000-a-month arrangement for Forestry and Research, raising procurement and zoning concerns. Hydropower Spending Scrutiny: PAC also probed SBD21.69m in advanced warrants tied to the Tina River Hydropower project, seeking Parliament’s approval to regularise already-spent funds. Governance & Oversight: Solomon Islands will strengthen Parliament’s autonomy, including moves toward an independent Parliamentary Budget Office, while all 50 constituencies are set for Constituency Development Fund audits using a community participatory approach. Telecom & Rural Connectivity: Satsol briefed PM Wale on plans to expand services into rural areas as reforms to the Telecommunications Act and TCSI are discussed. Climate Security & Diplomacy: Pacific foreign ministers backed stronger climate action ahead of COP31, while regional talks struggled to agree on a joint response to China’s missile test. Sports Funding: Home Affairs sought an extra $5m to host the Oceania Rugby Sevens, after PAC flagged process issues in the submission. Business & Trade: Polar Power received repeat orders for 15 more solar hybrid systems to support Solomon Islands broadband expansion. Regional News: PNGFA says it will not send a national team to the MSG Prime Minister’s Cup unless outstanding payments are settled.

China-Solomons Ties & Local Development: East Central Guadalcanal Constituency has acknowledged the PRC Embassy’s $100,000 support for the MRCA community-led sanitation project, aimed at improving water and health outcomes. Public Finance Scrutiny (PAC): Lawmakers questioned multiple supplementary rental and spending requests, including the Ministry of Lands seeking $956,430 for new office rent and PAC probing whether procurement and zoning steps were properly followed; PAC also challenged MMERE’s SBD21.69m Tina Hydro advanced warrants and questioned proposed SIBC and Honiara Senior High School funding. Rural Economy & Governance: MRD is developing a policy framework for Constituency Economic Growth Centres, while the government says all 50 constituencies will undergo CDF audits using a community participatory approach. Energy & Connectivity: Polar Power received repeat orders for 15 more solar hybrid systems to expand off-grid broadband support across Solomon Islands remote telecom sites. Security & Sovereignty: PM Wale says Solomon Islands is reviewing its 2022 China security agreement with a push for “no more secrecy” and full parliamentary awareness as regional tensions rise after China’s missile test. Disaster Risk & Resilience: Minister Derrick Manuari opened regional geohazard and tsunami warning meetings in Honiara, highlighting the economic stakes of monitoring and early warning systems.

Telecom Reform & Rural Expansion: PM Matthew Wale met Satsol executives as the company maps plans to expand reliable, affordable services into rural communities, with government reforms including a review of the Telecommunications Act and changes to the Telecommunications Commission. Geohazards & Early Warning: Minister Derrick Manuari opened major regional meetings in Honiara on seismic monitoring, geohazards and the Pacific Tsunami Warning System, stressing that preparedness investments protect communities and national economies. Regional Security Diplomacy: Pacific foreign ministers in Suva failed to agree on a joint statement condemning China’s nuclear-capable missile test, highlighting deep divisions as militarisation concerns grow. Parliament Autonomy: Wale pushed for stronger, more independent Parliament, including greater control of parliamentary finances and an independent Parliamentary Budget Office. Free Education Debate: Government says groundwork for fee-free education in 2027 is underway, while MPs warn of “urban drift” if provincial schools, teachers and facilities aren’t strengthened first. Public Finance Scrutiny: PAC questioned supplementary funding requests including $532,455 for SolCERT cyber work and $3.3m for Honiara Senior High School rehabilitation, plus $2.5m for SIBC strategy implementation. Governance & Rural Growth: MRD is developing policy for Constituency Economic Growth Centres, and all 50 constituencies will undergo CDF audits using a community participatory approach. Courts & Environment: High Court ordered two logging firms to pay $62m to Isabel communities over unlawful logging and damage to water, gardens and culturally important sites. Economy Outlook: CBSI projected a more favourable 2026-27 outlook, with growth supported by services and spending but risks from El Niño and global shocks.

Sovereignty & China Security: Prime Minister Matthew Wale says Solomon Islands is reviewing its 2022 security agreement with China, promising “no more secrecy” and insisting Parliament must be fully informed on deals that bind the country. Public Finance Scrutiny: The Public Accounts Committee questioned OPMC’s proposed $2.5m SIBC allocation and is also seeking $6.7m for the Auditor-General to upgrade audit methods and clear provincial audit backlogs. Free Education Push (2027): Government says groundwork is underway for fee-free education in 2027, but Opposition and MPs are demanding full costings, teacher and infrastructure readiness, and a clear funding plan. Economy Outlook: The Central Bank projects a better 2026-27 outlook, with growth improving in 2027, while warning risks remain from climate and global shocks. Digital & Revenue Tech: Australia-backed undersea cables now connect all PIF members, and Guadalcanal will pilot mobile systems to collect business licence fees and property taxes. Mining & Royalties: A sliding-scale royalty system will link gold royalties to global prices, alongside new labs to verify mineral exports. Infrastructure & Local Business: PAC paused MID’s supplementary review over figure discrepancies, while Honiara’s second road corridor moves to feasibility and design with ADB support.

Aid & Connectivity: Australia says it will keep its 2026-27 aid programme at $5.2b, with more than three-quarters going to the Pacific, while a separate milestone confirms all Pacific Islands Forum members—including Solomon Islands—are now linked by undersea cables, boosting digital access for businesses and services. Public Finance Scrutiny: The Public Accounts Committee paused MID’s supplementary budget review after figure mismatches, and it also grilled OPMC over nearly $31m in supplementary funding and MEHRD over a $76.9m request—raising questions on planning and accountability. Free Education Debate: PM Matthew Wale defended the 2027 free education plan and promised full costing in December, as Opposition MPs—including Tozen Leokana—warn the Government must show the money, teachers, infrastructure and long-term fiscal plan. Local Revenue & Infrastructure: Guadalcanal will pilot mobile payments for business licence fees and property taxes using the M-SELEN platform, and Honiara’s traffic relief push moved forward with procurement for a second road corridor feasibility study with ADB support. Economy & Resource Policy: CBSI projected a better 2026-27 outlook, and Government outlined reforms including a sliding-scale gold royalty system and new labs to verify mineral exports. Agriculture & Trade: CEMA’s Farmers First push was defended in Parliament as supporting thousands of copra/cocoa farmers, while a cocoa producer highlighted switching to CEMA agency work to access export licensing and better market terms. Diplomacy & Security: Pacific foreign ministers failed to agree on a joint statement condemning China’s missile test, underscoring widening divisions ahead of the Palau PIF leaders meeting.

Education Funding Clash: PM Matthew Wale defended GREAT’s free education plan as a poverty-proofing measure, but Opposition MPs pressed for full costings and financing details, with Wale saying the detailed costing will come to Parliament in December and that the “Speech from the Throne” is not the appropriation bill. Budget Process Scrutiny: The Public Accounts Committee paused MID’s supplementary budget review after figure mismatches between MID submissions and the 2026 Supplementary Appropriation Bill, ordering reconciliation with the Ministry of Finance before it proceeds. Economic Outlook: CBSI Governor Dr Luke Forau told PAC that growth should improve later in 2026 and pick up in 2027, with 2027 projected around 3.7%, while warning El Niño and global oil risks could hit exports. Mining & Power Reform: Government outlined a sliding-scale gold royalty system linked to global prices, plus new export verification labs, a “No Pay, No Ship” rule, and plans to cut electricity costs via renewable investment. Local Infrastructure Boost: In Small Malaita, Ou’oumatawa received a $190,000 CDF-funded 2-ton tipper truck to improve emergency access, farming logistics, and links to schools, health services and markets. Regional Trade & Connectivity: Australia-backed work means all Pacific Islands Forum members are now connected to undersea cable networks, supporting digital access for businesses and governments. Regional Security Tensions: Pacific foreign ministers in Suva failed to agree on a joint statement condemning China’s missile test, with New Zealand’s Winston Peters saying consensus was blocked by two members.

Free Education Fight in Parliament: PM Matthew Wale defended GREAT’s fee-free education plan in 2027, saying the “gate of the classroom” will not close due to poverty, while Opposition pressed for full costings and financing details; Wale says full costing will come to Parliament in December and that the Speech from the Throne is not the Appropriation Bill. Education Rollout Prep: MEHRD says groundwork is underway for 2027, including a Free Education Taskforce, specialist consultants, and curriculum reforms, with about SBD 1.4b allocated to education in the 2026 budget. Public Finance Discipline: Wale told Parliament the government is plugging revenue leakages by ending resource-sector tax exemption MOUs and restoring a single lawful exemption authority. Mining and Power Reforms: New Mineral Resources Bill moves royalties on a sliding scale with gold prices, adds government equity up to 25% in major projects, introduces “No Pay, No Ship,” and plans two labs to verify mineral exports; separate energy moves aim to cut Honiara electricity costs via Tina River hydropower transmission works. Infrastructure Budget Scrutiny: PAC halted MID’s supplementary budget review after figure mismatches, ordering reconciliation with Finance. Land Sector Overhaul: Government will introduce five land-related bills covering customary land governance, dispute resolution, housing, land information, and coastal/marine management. Regional Trade and Connectivity: Australia-backed work has pushed Honiara and the wider Pacific closer to cheaper, more reliable connectivity, with all PIF members now linked by undersea cables. Regional Diplomacy Tension: Pacific foreign ministers in Suva failed to agree on a joint statement condemning China’s missile test, with New Zealand accusing some members of being influenced by outside partners—issue likely to return at the Palau leaders meeting.

Free Education Push: PM Matthew Wale says the government backs the “free education” principle so no child is kept out of class by parents’ poverty, with the policy design and costing to be finalised for Parliament. Public Finance Discipline: Wale also told MPs the government is plugging revenue leakages, including ending resource-sector tax exemption MOUs and restoring a single lawful exemptions committee. Local Business Focus: Commerce Minister Harry Kuma reaffirmed Indigenous Solomon Islanders at the centre of economic development, including reserved business reviews, a new MSME framework, and stronger procurement pathways. China Training Numbers: China says it has trained 1,200 Solomon Islanders in programs in China since 2019, with 200+ students currently on scholarships. Digital Connectivity Milestone: Australia says all Pacific Islands Forum members are now connected to undersea cable networks, including primary links for Solomon Islands. Honiara Power Upgrade: Construction has started on a 22km transmission line to bring up to 15MW renewable power from Tina River to Honiara, targeting completion in early 2028. Honiara Roads: Work is moving on a second Honiara road corridor, with feasibility and detailed design being procured with ADB support. Markets & Trade Infrastructure: Seghe Market is 75% complete, and Kirakira Wharf in Makira-Ulawa is at 90%, both aimed at boosting local commerce. Regional Politics: Pacific foreign ministers in Suva failed to agree on a joint statement condemning China’s missile test, with New Zealand accusing some members of appeasing “outsiders.” Agriculture Expansion: Government plans new cocoa and coconut plantations, targeting 10,000 hectares, alongside rehabilitation and farmer support.