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HONIARA, Solomon Islands (April 28, 2000 – Radio Australia)---Solomon Islands Foreign Minister Patteson Oti says the country's 18 month ethnic conflict has inflicted serious damage on the economy, although it may not be particularly noticeable until later this year.

Authorities are predicting a budgetary crisis at year end, and are calling on donors for an increase in foreign aid, especially in areas such as health and education.

Mr. Oti said the closure of Solomon Islands Plantation Limited (SIPL), producer of palm oil, has been particularly hard, because it earned 20 percent of national export receipts.

"It was one of the basic demands by militants on Guadalcanal," he said. "About 80 percent of the employees of SIPL were from Malaita and because Malaitans had to go, the company had to go. It was employing more than 2,000 workers."

The almost two-year-long ethnic conflict between indigenous Guadalcanal islanders and immigrant Malaitans pertains primarily to land ownership and jobs issues on the capital island, Guadalcanal.

Meantime, Mr. Oti said the government is intending to develop airstrips throughout the country to help boost the economy of the provinces.

As part of last year's Honiara Peace Accord, the national government agreed to ensure that each of the seven provinces received a fair share of new development projects.

Previous governments had centralized developments on Guadalcanal, he said, causing a continuing influx of people to the capital island.

He said plans are under way to resolve the issue.

"This is why we are talking with a number of development partners. They now have to recognize that some of the problems that are happening now result from policies that were dictated by our leaders in the last 20 years.

"We want to build ten small, grass airfields by the end of this year (to) give people access to these remote islands.

"Thereafter the private sector has to come in," Mr. Oti said.

For additional reports from Radio Australia, go to PACIFIC ISLANDS REPORT News/Information Links: Radio/TV News/Radio Australia.

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