Prime Minister Matthew Wale has announced an ambitious regulatory overhaul of the Solomon Islands’ mineral sector, anchored by the establishment of a sovereign wealth fund to secure intergenerational wealth.
The comprehensive reform package, which includes seven pending amendments to the Mineral Resources Bill, aims to completely restructure how the nation manages its resources by establishing direct state involvement in mining and changing how communities receive royalties.
The government expects the Cabinet to finalize the amendments this week, Wale told local media.
“The government, people of the Solomon Islands, and resource owners are true beneficiaries of the mineral sector,” Wale said, outlining a new three-way partnership model.
“We must not repeat what has been happening in the Forestry Sector,” he stated.
Under the new policy is a planned sovereign wealth fund, which Wale described as essential to converting mineral wealth into sustainable, long-term revenue streams.
The fund, which is expected to be operational before the end of next year under the planning of the Finance Ministry, will invest mineral revenues to generate income for health, education, and other core services across generations.
To assert greater control over extraction, the government will establish a State-Owned Enterprise (SOE) to hold mining tenements and conduct independent prospecting.
This marks a significant departure from the purely concessionary model that has historically dominated the country’s extractive industries.
In his new Padcast Episode 1 Series, Wale said:
“We will do prospecting in partnership with the contractors, and the government will also hold shares and benefits on the mining activities.”
He said provinces hosting mining operations and local resource owners will also receive shareholdings.
Wale also reaffirmed the government’s commitment to the controversial “six feet clause,” ensuring the state retains central control of mineral resources below that depth.
“I know some people will be disappointed about this,” he acknowledged, “but there are good reasons for that so we have central control of our resources to manage intergenerational wealth.”
At the community level, Wale said new Trust legislation will govern how landowners benefit from mining.
“Crucially, benefits will no longer be distributed as direct cash payments, a policy choice designed to prevent rent-seeking behavior and ensure wealth reaches the wider community rather than just a few well-connected license holders.
“The money will not be distributed in cash, but rather on projects like housing, water supply, health and education,” Wale stated.
These sweeping changes are framed as a direct response to decades of failed forestry management, which Wale described as “rife with corruption and inequity”, leaving many resource owners worse off than before extraction began.
Wale acknowledged the reality driving the urgency of these reforms, natural loggable forest below 400 meters has been exhausted.
“When the sector plummets, so does the economy,” he warned, attacking previous governments for failing to prepare the economy for the timber industry’s inevitable collapse.
He criticized the past fiscal stewardship, citing squandered government cash reserves since 2015 and chronic cash rationing as evidence of poor management and regulatory capture.
To ensure the mining sector doesn’t repeat these mistakes, Wale said the need for downstream mineral processing, specifically pointing to gold refinement and nickel smelters, as critical to maximizing economic value and local employment.
“We have abundant natural resources, we should not be poor or hungry.”
You must be logged in to post a comment.