28 Oct 2004

Solomon Islands economy to start turning around with signing of new palm oil agreement

9:17 pm on 28 October 2004

The Solomon Islands Government believes it has just a signed a deal that will herald the rebirth of the country's economy.

It has reached agreement with a Papua New Guinea company to re-open and expand the operation of the huge palm oil operation on Guadalcanal, the Solomon Islands Plantations Ltd.

Before being forced to close by the ethnic unrest, SIPL, contributed around 20 percent of the Solomons export income.

It employed nearly two thousand people on its more than six thousand hectares, but Rural Development Minister, Walter Naezon, says the new operation will be much bigger.

"the agreement now provides for up to 15 thousand hectares. The first year they will employ around 900 workers, and towards the end of the third year or fourth year, they will have around two thosuand seven hundred employees"

Many SIPL had been Malaitan but Mr Naezon expects most of the labour force for the new operation will come from the local community.

He says the landowners will also have a 20 percent shareholding in the new company.