INTERNATIONAL BANKS CLAMP DOWN ON SOLOMON ISLANDS

HONIARA, Solomon Islands (April 5, 2002 - SIBC/PINA Nius Online)---The World Bank and the Asian Development Bank say they will not continue any current or new activities with the Solomon Islands Government unless the Government pays them its arrears.

This was the word from a joint mission representing the two financial institutions following discussions with the Government in Honiara.

In a joint mission report, a copy of which SIBC obtained, they said clearing of the arrears would also be an important signal to the Solomon Islands' other development partners.

The report added that the Government's relationship with both financial institutions will improve if it sets up a debt management strategy that prevents arrears from re-occurring.

Former Minister of Finance Michael Maina reaffirmed to the joint mission the Government's commitment to clearing the arrears.

SIBC understands that up until the end of last year, the Government's arrears with the Asia Development Bank reached $3.3 million and with the World Bank $1.1 million.

The joint mission praised former Finance Minister Maina and his team for their strong commitment to economic reform. They said that the progress made so far reflects Mr. Maina's leadership of the finance team.

The joint mission said the economic reforms need the support of the entire government, including Prime Minister Sir Allan Kemakeza and other senior ministers.

Mr. Maina was sacked last week by Sir Allan following controversy over his 25 percent devaluation of the Solomon Islands dollar.

The devaluation was praised by the Central Bank and Economic Association of Solomon Islands, which said it was vital to save the country's remaining external reserves.

The Solomon Islands economy has been crippled following two years of Guadalcanal-Malaita ethnic conflict and continuing law and order and governance problems despite a peace agreement.

In other news:

* Foreign Affairs Minister Alex Bartlett has apologized for his part in the ethnic conflict.

Speaking in Parliament, Mr Bartlett apologized on behalf of himself and former Malaita Eagle Force militia members and elements of the paramilitary police field force.

Last month former spokesperson for the Malaita Eagle Force, Andrew Nori, held reconciliation ceremonies with some former members of the Solomon Islands Alliance for Change government, which the force ousted in the June 2000 coup.

For additional reports from the Solomon Islands Broadcasting Corporation, go to PACIFIC ISLANDS REPORT News/Information Links: Radio/TV News/Solomon Islands Broadcasting Corporation.

Pacific Islands News Association (PINA) Website: http://www.pinanius.org 

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