20 Aug 2009

ADB warns Solomon Islands economy will not grow

11:11 am on 20 August 2009

The Asian Development Bank has warned the Solomon Islands economy will not grow this year.

Th ADB gave the warning in its latest report that predicted shrinking South Pacific Island economies.

The Solomon Star newspaper reports the country's lack of growth this year is due to the falling log prices globally.

Logging has been the country's major export commodities over the past years.

The paper adds, coupled with the depleting forest in the country and dropping world prices, Solomon Islands economy as predicted by Central Bank of Solomon Islands a few months ago, is now experiencing a draw back in its growth.

ADB, which is based in Manila, says most island nations will yet to experience the full brunt of the financial crisis.

Solomon Islands is within the mostly likely affected countries.

The report says most island economies are expected to contract in 2009 due to weak tourism and remittances.

It states, the global economy is showing signs of stability, but the full impact from the downturn in the United States, Australia and New Zealand has yet to hit 14 island nations in the region monitored by the Manila-based lender.