Honiara, Solomon Islands – The first signing ceremony of the Memorandum of Understanding (MoU) between three leading financial intermediaries and the United Nations Development Programme (UNDP) marks a significant milestone in the effort to strengthen informal enterprises in the Solomon Islands.

This initiative falls under the Supporting Informal Enterprises Transition Towards Sustainable Growth and Formalization in the African, Caribbean and Pacific Regions project, jointly funded by the European Union (EU) and UNDP.

The Development Bank of Solomon Islands (DBSI), the Solomon Telekom Company Limited (STCL), and the Solomon Islands National Provident Fund (SINPF) have emerged as essential partners, joining hands with UNDP to empower and elevate informal enterprises in the Solomon Islands. Acknowledging the prevalent nature of the informal economy in Africa, Caribbean, and Pacific countries, including Solomon Islands, where it constitutes a substantial portion of both economic activity and employment, the need for strategic intervention is clear.

Statistics from the International Labour Organization (ILO) reveal that a considerable majority of the Solomon Islands' labor force engages in the informal economy, contributing up to one-third of the country's total GDP. However, this sector grapples with inherent challenges such as low productivity, limited income, and entrenched poverty, primarily attributed to an unfriendly regulatory landscape, inadequate access to public and business services, training, market infrastructure, and financial support.

With the acute understanding of these impediments, the EU and UNDP crafted the Informal Economy project aimed at alleviating constraints across three specific countries - Mozambique, Sierra Leone, and the Solomon Islands. Such an endeavor recognizes the intricacies of the challenges faced by the informal sector and underscores the crucial need for collaboration with key stakeholders in the respective countries.

Recognizing the value of this initiative for Solomon Islands, Riley Mesepitu, Permanent Secretary from the Ministry of Commerce, Industry, Labor and Immigration, expressed his gratitude to UNDP and partners for this cooperation. This demonstrates an unwavering commitment to advancing the Sustainable Development Goals, the Solomon Islands National Development Strategy 2016-2035, the country’s Micro Small Medium Enterprise Policy; and the recently launched Solomon Islands E-commerce Strategy and Roadmap 2022-2027.