On the eight-kilometre stretch between Alligator Creek and the Ranadi industrial area in Honiara, drivers idling in the city’s notorious traffic are greeted by a scattering of signs reading “we buy gold”. About 20 of these signs have appeared over the past three years, many printed on billboards, others hastily painted on walls or cardboard.
The rapid appearance of the signage and the gold buyers they advertise hints at a seismic shift in the economy of Solomon Islands. Timber exports have been a key source of government revenue since the 1990s. But a protracted decline in logging has left a big hole in the government’s wallet, one that gold is rapidly filling.
Logging decline
Timber exports have been in steady decline since the mid-2010s, as easy-access, high-profit forests dwindled and international demand shifted to other producers. Trade figures suggest logging revenues halved between their 2018 peak and 2022. By the second quarter of 2025 logging revenues had fallen to just SBD$218 million, a 73% decline from mid-2010s highs. By this same point minerals revenues, gold driven, reached SBD$760 million, accounting for over half of all export revenue.
The decline in logging was long forecast. Harvesting rates had been out of control for years, with government and independent reports putting the deforestation somewhere between 12-20 times beyond sustainable levels. Limited state capacity and corruption meant enforcement was minimal. Even at logging’s peak, tax revenues fell well short of what the scale of extraction should have delivered. Much of the demand was driven by Chinese and Malaysian logging outfits with the vast majority of the Solomons’ timber exported to China. But many of these operators didn’t return after the pandemic, and locals suggest those who did have shifted to mining.
Gold rush
The meteoric rise in the gold price was well timed for the gold-endowed islands, with gold production responding from both formal and informal sources. The major player has been the Gold Ridge mine, the country’s only large-scale operation, which resumed exports in December 2022 under its Chinese-majority owner, Wanguo International Mining Group. Wanguo contracted Chinese state-owned enterprise China Railway Group for a US$825 million reconstruction and upgrade project. The deal was described by Xue Bing, China’s ambassador to Solomon Islands, as an “early harvest” stemming from 2019 decision by Solomon Islands to switch diplomatic recognition from Taipei to Beijing.
None of these risks are insurmountable … Solomon Islands is not the first resource-dependent country to see one extractive industry give way to another.
The second source of gold comes from the chaotic artisanal and small-scale mining sector, much of it unlicensed. As far back as 2021, domestic press was describing an illegal gold rush. While reliability and availability of numbers make exact figures hard to get a clear line on, comparing Wanguo’s production reporting with government figures suggests about 60–70% of national gold production is coming from Gold Ridge. Noting there are no other large-scale gold mining operations in the country, this suggests the remaining share is sourced from panhandlers and small operations.
Local reporting suggests the going rate for a gram of gold in Honiara is SBD$400–600, about 40% of the international spot price. Artisanal miners have no direct access to international markets, so they sell to middlemen at highly variable rates. Investigations assert these buyers, typically Chinese and Singaporean nationals, often don’t declare the exports. If the number of gold stalls dotting Honiara’s main strip offers any proxy for the scale of informal flows, they are considerable.
Awareness of this tax leakage has been significant enough to provoke a response from the government, which in August last year announced a three-month ban on the gold stalls. Yet local reporting asserts the ban was largely ignored by gold buyers.
Risks and questions
The shift from logging to mining has the potential to plug a gap in the Solomons’ government budget, but it brings big risks, some old, some new.
The first is governance. Huge constraints on state capacity mean the artisanal sector is poorly regulated, and a source of both lost tax revenue and exploitation. The Mineral Resources Bill, currently before parliament, is intended to fix the regulatory framework, but civil society groups argue it will reduce community protections rather than strengthen them. Issuance of permits remains opaque and susceptible to corruption, with reform needed but unlikely. Landholders benefiting from the current arrangement are likely to strongly resist any threat to their earnings.
The second is conflict. As gold prices have spiked, so too have tensions. In January 2025, landholders set fire to more than 30 mining vehicles at Gold Ridge, an escalation in the ongoing disputes between illegal miners, landowners, and authorities. Tensions over land access, distribution of revenues, and the conduct of police and security forces on customary land, echo the violence that erupted at the mine site in the 1990s.
The third is environmental. The logging sector left a legacy of intense environmental degradation. An expansion of mining activities across the archipelago poses a renewed threat. Past operations at Gold Ridge produced arsenic contamination, acid drainage, and contaminated water for downstream communities. The mine’s current operators, like those before them, face minimal pressure to comply with the country’s already limited environmental standards.
Yet none of these risks are insurmountable. Support for local cooperatives could give small-scale miners more bargaining power. Real-time gold pricing via mobile phones would reduce the information asymmetry that buyers exploit. A more ambitious step could be for the country’s central bank to establish a direct gold purchasing program, as Ecuador has done successfully, simultaneously capturing lost revenue and protecting miners from predatory middlemen.
Solomon Islands is not the first resource-dependent country to see one extractive industry give way to another. Whether this transition delivers more durable benefits than logging did, or follows the same pattern of foreign extraction, limited local gains, and environmental cost, will depend on whether the institutions governing the sector prove stronger this time around.
