The writing is on the wall, experts are pointing to a historic economic downturn. The International Monetary Fund (IMF) say worldwide gross domestic product will shrink by 3.0 percent in 2020, compared to an initial January projection of 3.3 percent growth.
"I still don't think we're going into a depression," said Thomas Gilbert, a University of Washington professor of finance and business economics. "But I think the recession will be quite bad."
For Solomon Islands, Prime Minister Mannaseh Sogavare says that preliminary predictions from CBSI and the Ministry of Finance indicate that Covid-19 is "likely to have considerable negative impact on the Solomon Islands economy."
In his speech to launch the governments economic stimulus plan Sogavare says that the the country is heading towards a recession in the second half of 2020.
"A significant decline in GDP growth is expected to decline further to negative 4.9 percent in 2020 as a result of reduction in logging and fisheries exports, a contraction in tourism, as well as the negative impact of containment measures that include suspension of all international flights, entry restrictions of non-citizens and strict mandatory quarantine for all returning passengers,
"The forestry sector expects a 11% decline in log output, 9% fall in foreign exchange receipts and a 6% drop in government revenue from duties on logs. With nearly half of the Solomon Islands workforce thought to be directly or indirectly associated with the logging sector, the economic impacts will reverberate across all parts of the country," Sogavare said.
He says that the tourism sector is also being hit hard with tourism operators in Honiara predicting a 10% occupancy rate for April, and the predictions for May and beyond are expected to be lower.
"This all points to a dire prospect for the national economy through business closures, loss of jobs, pressure on government revenues, and a serious contraction in aggregate demand.
"In our efforts to dampen the impact of the pandemic, especially the immediate impacts, my Government has decided to provide a first round Economic Stimulus Package of SBD309 million or approximately USD$38 million, to ease the fallout of the pandemic on businesses and the general population and to keep the economy afloat."
Observers say the success of the economic stimulus plan will depend on how it is executed - how well programs are rolled out at the operational level.