1. SOLOMON ISLANDS ECONOMIC PERFORMANCE IN 2013 LAUNCH OF THE CBSI 2013 ANNUAL REPORT KITANO MENDANA HOTEL JUNE 5 2014

2. ECONOMIC GROWTH 3.2% IN 2013 BUT EXPECTED TO SLOW DOWN IN 2014 2

3. PRODUCTION INDEX Improved in the second half of 2013 3 Weak prices & supply shocks

4. TRADE PERFORMANCE Trade (in goods & services) deficit 4

5. GROSS FOREIGN RESERVES… cover 11.2 months of import 5

6. EXCHANGE RATE SBD appreciated against AUD 6 Source: CBSI Appreciates SBD mid 2013Q3

7. CREDIT TO PRIVATE SECTOR ROSE 15% YoY to $1.46Bn 7

8. MONETARY CONDITIONS Excess liquidity fell as PSC rises 8 Source: ODCs & CBSI

9. FISCAL BALANCE…. A smaller prelim surplus of $133m 9

10. INTEREST RATES HOVERED AROUND 10% IN 2013 10

11. INFLATION RATE….. Picked up in 2014 after slowing down in 2013Q4 11 Source: SINSO & CBSI

12. SUMMARY 2013  Economy rebounded in the second half  Trade deficit  Adequate External Reserves to finance trade  Another fiscal surplus  Private sector credit rebounded  Inflationary risks eased last year  Public Investments continued Outlook  Near Term Risks (higher inflation and slow growth)  Medium term – expecting growth 12