Economic Horizon

"Ominous "

On Bsip's

Disappointing figures for

Solomon Islands cocoa and copra production for 1964 were revealed in Honiara in December when the Financial Secretary, Mr. L. M. Davies, made his budget speech to the

Legislative Council.

MR. DAVIES referred to the dis appointing results as “ominous clouds” on the BSIP’s economic horizon, but despite them, he said, the budget for 1965 was at a record figure, with expenditure at just over £3 million.

More important, the budget could be balanced with a reduced grant-in aid.

Mr. Davies said that in 1964 there was a deficit in the BSIP’s visible trade balance of £660,000 compared with £385,000 the previous year. The position had therefore worsened and the Solomons were back where they were the previous year.

Imports at £2,745,000 in 1964 were £660,000, or 30 per cent, higher in value, than those for 1963, while exports increased by £384,000 to £2,086,000.

"Disquieting"

Those concerned with the health of the nation, Mr. Davies said, would be “disquieted to know” that the volume of imports of cigarettes and tobacco had increased by one-third. (Tobacco imports plus liquor were up by £42,000 during the year to £217,000).

Figures for the main exports for 1964, with those for the previous year in parenthesis, were: Copra, 23,900 tons, valued at £1,800,000 (212,650 tons, £1,500,000); timber, 875,000 cubic feet, valued at £157,000 (238,000 cubic feet, £80,000).

Other exports which contributed to the economy in 1964 were: Forty tons of cocoa worth £6,500, shell worth £25,000, and crocodile skins worth £35,000.

Mr. Davies said: “Exports to the United Kingdom and Australia de clined to 50 per cent, and 21 per cent, respectively whilst those to Japan rose to 26 per cent. The pattern of supply of imports remained much the same, with 45 per cent, coming from Australia and 23 per

cent, from Britain.

“Provided that freight rates and prices within the Pacific remain com petitive (and in this context the in crease of freight rates from Aus tralia was depressing) this trend in the pattern of our trading should be to our advantage.

Sugar From Fiji?

“One trusts that importers, in particular, are constantly examining new sources of supply so that every one can benefit from the best quality at the cheapest prices. As an example, one wonders whether sugar and cigarettes could not be imported more cheaply, from Fiji.”

Mr. Davies said that the production of cocoa had been “frankly dis appointing”, in 1963 he had forecast a fivefold increase in production to some 200 tons, whereas only 60 tons would be exported.

“It is a matter of great personal regret to me, who has so persist ently supported the introduction of this crop, that production is so low,” he said.

There were four main reasons for the low production: Difficulty in supervising peasant production, dam age by rats and black pod disease, transport and marketing difficulties, and low world prices because of over production. (Over)

The situation called for increased effort both from extension services and producers.

Mr. Davies said production of copra would be slightly down on the target aimed for of 26,250 tons, and that in the circumstances the pro duction target for 1965 could only be set at 26,000 tons.

“I know that one can’t expect everything to come good at the same time,” he said, “but, my goodness, we need it to do so. I know, too, that the relatively dry months in the middle of the year have affected pro duction but I am quite sure the climate is not the only reason.

“We all know of areas in which copra could be made, but is not made; where coconuts ought to be collected, but remain on the ground; where people ought to be working hard on their farms, but are not doing so; where ships should be calling to carry copra away, but are not arriving.

“It is, I know, of only small help to talk about this. What obviously is necessary is to plan to do something about it.”

Timber Mr. Davies said that developments in the timber industry had not been as great as had been forecast for 1964, but substantial progress has been made.

Some 10,000 acres of timber had been acquired for exploitation, and provided Solomon Islands logs could gain the necessary reputation on the world market, exports were ex pected to expand rapidly in 1965.

The Government aimed to com plete an aerial reconnaissance of the Protectorate’s forests at an early date.

Referring to the aerial geophysical survey to be made in 1965, Mr.

Davies said this would probably begin in May and might take six to eight months. It would be followed by a vigorous ground search for minerals in the most promising areas over a period of three years.

“We are also considering increas ing local production by planning and carrying out settlement schemes for both Solomon Islanders and Gilbertese in suitable areas which are largely uninhabited and capable of growing cash crops,” Mr. Davies said. ‘The Commonwealth Develop ment Corporation is interested in schemes of this type.”

Turning to communications, Mr.

Davies said more thought would have to be given to future transport developments if the Solomons were “to keep in tune with the times.”

Meanwhile, more airfields were being opened, two heavy plant construction units were being formed to build

roads on Malaita, Vella Lavella, and Guadalcanal, old ships were being replaced, and telecommunications were being improved.

Mr. Davies said that in 1964, the number of co-operative societies in creased from 61 to 74. However, some people did not yet appreciate that the co-operative movement offered “the most ready form of direct participation and experience in modern systems of trading available to Solomon Islanders.”

Statistics for savings bank deposits were “vastly encouraging”. One in 16 people in the Protectorate now had an account, and the average in dividual account was £66.

Mr. Davies said that, as a result of the malaria eradication programme on Guadalcanal and New Georgia, the population of the Solomons was increasing at such a rate that there was a danger that the demand for services would outrun the capacity to supply them unless productivity per head could be increased.

“In 1964,” he said, “we assumed a population of some 133,200, about 6,500 of whom were paid workers.

In 1965 we estimate the population would have risen to 137,000.

“The long-term effect of this in crease is to increase the number of dependents without immediately in creasing the number of producers.”