UNCDF in Solomon Islands

UNCDF in Solomon Islands

The Challenge

Despite the rapid economic growth experienced by Solomon Islands from 2003and 2008, recent conflicts have made the country unstable and disrupted education, services and business. Key concerns for the country are to restore law and order, support economic recovery and growth and to address basic social needs. Today, transportation and communication links across the country remain inadequate, restricting opportunities for engagement in the formal economy. Climate change will be a major impediment to the achievement of sustainable development in Solomon Islands, as all economic and social sectors are likely to be adversely affected, and the cost of adaptation will be disproportionately high. Solomon Islands ranks at 143 out of 187 countries in in the 2013 Human Development Index.

How We Are Helping?

UNCDF is helping to address development challenges in Solomon Islands through the UNCDF/UNDP Provincial Governance Strengthening Programme (PGSP). This programe aims to improve governance and service delivery through fiscal decentralization and increased local investment capacity, to bridge funding and service gaps in provincial areas. There is a strong emphasis in improving basic capacity for public expenditure management in all nine provincial governments, so that authorities can produce and execute credible budgets through appropriately participatory and transparent procedures.

To address the climate change challenge in Solomon Islands, UNCDF is piloting its “Local Climate Adaptive Living Facility”. The facility, known as “LoCAL”, increases climate change adaptation financing while strengthening the capacity of local governments and of the local climate change adaptation planning process through a system of performance-based grants.

In inclusive finance, UNCDF is active with its Pacific Financial Inclusion Programme (PFIP). PFIP aims at finding new ways of serving hard-to-reach populations, while fostering greater commitment and cooperation to build inclusive financial systems throughout the region. At the core of its efforts is building branchless banking platforms that can reach low income and rural households, the vast majority of which are unbanked. 

Moreover, the Least Developed Countries Fund for savings-led market leaders for inclusive finance (MicroLead), aims to increase access to financial services, particularly savings, by supporting the expansion of microfinance savings-led market leaders in underserved countries.

In Detail


Provincial Governance Strengthening Programme (PGSP)

Goal To strengthen governance capacity for improved service delivery at the provincial level.
  • By developing capacities of provincial authorities in public expenditure management;
  • By incentivizing provincial authorities to adopt participatory and transparent expenditure management practices.
Period 2008-2014
Partners UNCDF, UNDP, Government of Solomon Islands, Australian Agency for International Development (AusAID), European Commission.
Total project cost and UNCDF contribution USD 14,602,347
USD 1,000,000

Local Climate Adaptive Living Facility (LOCAL)

Goal To respond effectively to climate change while strengthening local government capacity and local climate change adaptation planning.

Increasing climate change adaptation financing through performance-based grants.

Period Starting 2014
Total project cost and UNCDF contribution USD 1,500,000
USD 700,000

Pacific Financial Inclusion Programme (PFIP)

Goal To expand access to financial services, focusing primarily on rural and low income women and men and micro-enterpreneurs

Working directly with policy-makers, industry leaders, community organizations and the unbanked population, our work takes a holistic approach towards increasing financial inclusion in the Pacific. PFIP is currently focusing on four key areas:

• Branchless banking;
• Financial competency;
• Microinsurance;
• Financial Inclusion Policy and regulation.

Period 2008-2011
Partners UNCDF, UNDP, Governments of Solomon Islands, Samoa, Vanuatu, Kiribati, Tuvalu, European Commission, Australian Agency for International Development (AusAid).
Total project cost and UNCDF contribution USD 7,268,986
USD 1,820,319


Goal To increase access to financial services, particularly savings, by supporting the expansion of microfinance savings-led market leaders in underserved countries.
  • Offering grants and loans that incentivize leading providers to start up new, or strengthen existing financial institutions that target low-income people, especially with savings, in underserved areas, particularly countries struggling to recover from crisis and conflict;
  • Through a competitive process to select leading indigenous microfinance providers from developing countries to expand their reach by implementing a variety of approaches including greenfields, transformations of MFIs to formally regulated deposit-taking institutions, and providing technical assistance to in-country MFIs;
  • Supporting technical advisors who work to help those providers to develop the institutional capacity to extend their reach.
Period 2008-2017
Partners UNCDF, Bill & Melinda Gates Foundation, The Mastercard Foundation, LIFT Myanmar.
Total project cost and UNCDF contribution USD 58,562,939
USD 7,871,850

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