Thursday, 2 October 2008 8:09 AM

CBSI Governor: "Your Money is Safe"

With what appears to be an escalation in the global financial crisis, many Solomon Islanders are worried that the crisis might affect their savings.

But the Central Bank Governor, Denton Rarawa, has assured all Solomon Islanders that their money is safe. Mr. Rarawa says this is despite the current financial crisis that hit major Banks in the United States.

Mr Rarawa says that the two banks in Solomon Islands have their origins in Australia and one from Papua New Guinea, whose economies are not directly affected by the financial crisis.

He says Solomon Islands, Papua New Guinea and the Australian financial positions are relatively sound and there's no need to panic over what is happening in the U-S.

Mr Rarawa says Solomon Islands will not feel the ripples of the U-S banking fiasco for a very long time and people are assured that their money in the three banks in Solomon Islands are safe.

The effects of a deepening in the financial crisis will be significant. It appears likely that advanced economies may not be able to fully 'weather the storm.' Ireland is already in recession, the UK, Germany, Italy, Spain, Switzerland and Japan are said to be "at the brink", and it is difficult to see how the US can avoid recession.

With such global downturn it seems obvious that Global trade will suffer, and economic activity in emerging countries will also slow down considerably. Solomon Islands may well have to brace themselves for rising inflation.

With SIBC