Setting up a business venture in the Solomon Islands is more than just a change of tropical scenery. It involves entering a transitioning island economy, where the state relies on the private sector to drive growth, but where on-the-ground realities—electricity costs, access to finance, transport costs, the weight of customary law—demand thorough preparation before arrival.
For an expatriate, the country offers opportunities in sectors like tourism, agribusiness, services, or renewable energy. However, it is essential to thoroughly understand the legal framework, business culture, taxation, and the archipelago’s specific operational constraints to succeed.
Understanding the Economic and Social Context
The Solomon Islands form a Melanesian archipelago of nearly 1,000 islands, about 90 of which are inhabited, spread over more than 1,500 km in the South Pacific. The capital and main business center, Honiara, concentrates most formal businesses. It is estimated that about 85% of registered companies are based there, while over 70% of the population lives in rural areas.
Nearly half of the country’s population is under 18, making it a very young society.
The business environment is officially open: the state relies on private investment, including foreign, to create jobs, transfer technology, develop exports, and reduce imports. Strategic frameworks like the National Development Strategy and infrastructure investment plan clearly place the private sector at the heart of development.
But the country remains ranked in the lower part of the World Bank’s Doing Business ranking. Starting a formal business involves navigating between three levels of power (national, provincial, customary authorities), with procedures still largely manual and under-resourced administrations.
A Very Relational Business Culture
It is impossible to build a sustainable project without immersing yourself in the local culture. The Solomon Islands largely operate on a community system called “wantok”, based on language, family, and village. It creates strong solidarity obligations but also an expectation of reciprocity and respect.
Business decisions in this region prioritize interpersonal relationships and informal consultations over formal written exchanges. For instance, meetings often begin with light conversation (small talk), response times are deliberately slower to show respect, and direct confrontation is avoided. A verbal promise is considered a serious and binding commitment, equivalent to a written contract.
For an expatriate entrepreneur, this means taking the time to build relationships, accepting that land or partnership negotiations can take months, integrating community interests into the business model, and maintaining a calm and respectful attitude even when setbacks accumulate.
Where are the opportunities for a foreign entrepreneur?
The Solomon Islands remain underdeveloped in many segments. The government, through the agency InvestSolomons and other private sector support programs, targets several sectors considered priority for foreign investors.
Tourism and Hospitality: A Largely Untapped Potential
With its lagoons, coral reefs, world-renowned dive sites, and WWII relics, the archipelago has everything to attract a clientele seeking authentic destinations. Yet, arrivals remain low compared to other Pacific islands, and the supply of quality accommodation is limited.
Authorities and programs like Strongim Bisnis actively support hotels, lodges, resorts, and activity operators (diving, hiking, community tourism). Partnerships already exist to renovate accommodations, improve marketing, or develop domestic tourism.
For an expatriate, this can translate into opportunities in the following areas: small high-end accommodation facilities, eco-lodges, adventure tours, niche cruises, tourism products around history or culture, booking and e-tourism services, particularly via social media (Facebook is widely used, and Instagram usage is growing rapidly).
Agribusiness, Cocoa, Copra, Horticulture, and Fisheries
Over 80% of the population depends on agriculture, often on a small scale. The flagship crops are cocoa, coconut, palm oil, as well as horticultural products. These value chains are supported by several initiatives: plantation development, support for producers, improvement of processing and export outlets.
Local SMEs manage to achieve significant exports, such as shipping over 50 tonnes of cocoa to Malaysia. Furthermore, women constitute a significant part of the agricultural workforce, particularly in the horticulture sector.
Fishing is another pillar: the waters of the Solomon Islands are particularly rich in tuna, and the country earns significant access fees from foreign fleets. At the same time, domestic markets suffer from fragile supply chains for delivering fresh fish to urban or tourist areas.
For an expatriate entrepreneur, niche opportunities can include processing local products (like chocolate, cocoa butter, coconut-derived products, or value-added seafood), developing logistics solutions suited to perishable goods, and providing specialized services such as quality certification, packaging design, brand marketing, or creating digital platforms connecting producers and buyers.
Timber, Energy, and Infrastructure Projects
The country has long relied on the export of logs, with heavy impacts on forests. Authorities now wish to prioritize local processing (sawmills, furniture, quality timber) and planting sustainable species, with support from programs like Strongim Bisnis and the VATA association for value-added timber.
Energy offers another field of action. The cost of electricity is among the highest in the Pacific (nearly USD 0.80/kWh in some years), and the grid remains limited, especially outside Honiara. Power outages and load shedding weigh heavily on businesses, which turn to self-sufficient solutions. The state aims for a massive transition to renewables, and solar, micro-hydro, or diesel/solar hybrid projects are strongly encouraged, with an investment framework for independent power producers (IPP).
Key elements to integrate for building a viable business in the photovoltaic sector on an island.
Anticipate import lead times and transport costs specific to island constraints.
Plan an adequate stock of spare parts to ensure service continuity.
Train local technicians for the installation and maintenance of solar modules.
Define a reliable maintenance model adapted to geographical isolation.
Professional, Digital Services, and Business Support
The rise of small and medium enterprises, growing tourism demand, and the development of international trade also create demand for services: accounting, audit, legal advice, marketing, IT, cybersecurity, quality, environment, translation and interpretation services, or project facilitation (project management, feasibility studies, compliance assistance).
Several players like Business Link Pacific or regional firms (legal, tax, technical) are already active, but supply remains limited relative to needs, especially in the provinces. The government is also banking on digital transformation: the arrival of the Coral Sea submarine cable has multiplied internet capacity tenfold, a national digital strategy and an ICT policy have been adopted, and e-government and digital financial inclusion projects are underway.
With a population highly connected via mobile but still underbanked and a growing internet penetration, there is space for adapted e-commerce solutions, cloud-based management tools, local digital payment services, or marketplaces linking rural producers and urban consumers.
Choosing the Right Legal Structure for Your Project
Company law is based on the modern Companies Act, supported by an online business registry, Company Haus. Several forms are open to expatriates, each with its advantages and limitations.
Private Limited Company
This is the most common form for foreign investment. It offers limited liability for shareholders, a framework familiar to banks and the administration, and some flexibility in organization.
For this type of company: private limited company (Ltd), simplified joint-stock company (SAS), or public limited company (PLC). It is important to consider legal, tax, and social aspects to determine which best suits the needs and objectives of the shareholders.
– the name must end with “Limited” or “Ltd”;
– the number of shareholders ranges from a minimum of 1 to a maximum of 50;
– at least one director (who can be a foreigner) and at least one share are required;
– there is no mandatory minimum capital;
– a local registered office address is mandatory.
For a solo expatriate or a small group of investors, the private company generally constitutes the best compromise between legal security, commercial credibility, and simplicity.
Other Possible Forms
It is also possible to create: a collaborative work environment, innovative projects, solutions tailored to specific needs.
Structures include a sole proprietorship, simple but with unlimited liability for the owner; a partnership between two or more persons; a branch of a foreign company, where the parent company remains liable; a representative office, limited to prospecting and marketing activities; and a ‘community company’ intended to manage community assets, often relevant in projects involving customary lands and clans.
Business Forms in a Specific Context
The absence of a requirement for local shareholders or directors is an advantage for expatriates, although, in practice, partnering with Solomon Islands partners can facilitate access to land, networks, and public tenders.
The table below summarizes the most common options for a foreign entrepreneur.
| Legal Form | Liability | Number of Shareholders/Partners | Permitted Activities | Relevance for an Expatriate |
|---|---|---|---|---|
| Private Limited Company (Ltd) | Limited to capital | 1 to 50 | Any legal commercial activity | High |
| Branch of Foreign Company | Unlimited (parent company) | N/A | Commercial activities | High for groups |
| Representative Office | N/A (no trading) | N/A | Marketing, market studies | Medium (exploration phase) |
| Sole Proprietorship | Unlimited | 1 | Small service or trade activities | Medium to Low |
| Partnership | Joint and unlimited | 2 or more | Various activities | Variable, depending on project |
| Community Company | Specific, community-based | Variable | Management of community assets | Useful with customary partners |
Key Steps to Register Your Business
Reforms undertaken with the support of the Asian Development Bank have significantly accelerated company registration. What used to take several months can now be done in one to two days for the purely corporate part, thanks to Company Haus. However, several steps with different authorities must still be completed.
From Idea to Registered Company
The typical journey for an expatriate looks like this:
A guide to the essential procedures to legally register and launch your company in the Solomon Islands.
Choose the legal form, structure shareholding, then reserve and get the company name approved with Company Haus.
Prepare incorporation documents (articles, directors, etc.) and file the application online or physically at the Business Registry, paying the fees.
Obtain the Certificate of Incorporation, then apply for a Tax Identification Number (TIN) from the Inland Revenue Division.
Open a local professional bank account and obtain the business operating license from the relevant municipal authority.
Depending on your activity (fishing, mining, tourism, health…), apply for the required specific licenses or approvals.
Register the company and its employees with the National Provident Fund (SINPF) within 14 days of starting operations.
The registration itself is relatively quick: the time required to obtain name approval and the certificate of incorporation is estimated between one and three days. However, all the procedures to ” start a business” (including licenses, account opening, etc.) take, in practice, about ten days at best, sometimes longer.
Documents and Fees to Anticipate
Authorities generally require:
List of essential documents to provide for legally incorporating and registering your company.
Duly completed and signed company registration application forms.
Certified Articles of Association or Constitution of the company.
Copies of passports for the company founders and directors.
Clean police clearance certificate for each director.
Proof of address for the company’s local registered office.
Proof of payment of required administrative and registration fees.
Among the indicative amounts:
| Procedure | Indicative Amount |
|---|---|
| Registration of a local company | 1,250 SBD |
| Registration of a business name | 150 SBD |
| Making a company seal (optional but common) | 500 SBD |
| Business license (e.g., manufacturing in Honiara) | 2,700 SBD |
To these must be added hidden costs: time spent moving between offices, possible translations, fees for local consultants, or inter-island transport if your project extends beyond Honiara.
Specific Foreign Investment Framework
Foreign investment is governed by the Foreign Investment Act. An expatriate cannot simply create a company and start: they must obtain a Foreign Investment Certificate (FIC) from the competent body (Foreign Investment Division, InvestSolomons). Some activities are reserved for nationals or subject to conditions via a “Reserved List“.
The application process requires a comprehensive project description, including its sector, amount and source of funds, ownership structure, and expected economic impacts (job creation, skills transfer, use of local raw materials, etc.). The review of applications can take several weeks, especially for projects in sensitive sectors like natural resources.
Once the certificate is obtained and the company registered, the investor can also apply for tax incentives: customs duty exemptions on machinery and equipment, tax holidays, tax credits for certain projects (e.g., in mining or green energy).
The official rates are as follows:
| Tax / Parameter | Rate / Key Information |
|---|---|
| Corporate tax for resident companies | 30% |
| Corporate tax for non-resident companies | 35% (on Solomon Islands sourced income) |
| Dividend tax (residents) | 20% (withholding tax) |
| Dividend tax (non-residents) | 30% (withholding tax) |
| Existence of a capital gains tax | No general tax; certain assets taxed |
| Minimum turnover tax | 0.5% (capped at 20,000 SBD) |
For an expatriate, a crucial point is to properly structure their presence: depending on whether the company is considered resident or non-resident, the taxable base will change (worldwide income or only locally sourced income). In many cases, a separate local subsidiary, properly capitalized and documented, avoids potential tax disputes.
Obtaining a Visa and Work Permit as an Entrepreneur
Starting a business is not enough to live and work legally in the country. Immigration rules distinguish several types of visas, with specific conditions.
Short-stay Business Visas
For simple scouting, meetings, or short-term missions, many nationals benefit from a visitor’s permit on arrival, provided they have a valid passport, a return ticket, and sufficient financial means. This status allows conducting business activities related to your usual functions abroad for 30 days, without being locally employed.
Beyond 30 days of work or for any on-site employment (including in your own company), a work permit issued by the Labour Division and a corresponding entry visa (short-term or long-term employment visa) are absolutely required.
There is also a dedicated “short-term business visa” for business travel without local remuneration, valid for one year for multiple entries, but non-renewable except through a new application.
Long Stay, Investment, and Employment
To settle permanently and manage one’s business, an expatriate generally must combine:
– an investment permit (Foreign Investment Certificate) for the company;
– a work permit linked to a defined position within that company;
– an employment or long-term residence visa (often up to two years, renewable).
Obtaining a work permit requires a local sponsor, which can be your own company after its incorporation or a local partner. The employer must demonstrate the necessity of recruiting a foreigner through labor market tests and justify rare skills. They must also provide contracts, repatriation guarantees, and commit to complying with prevailing social legislation.
Lead times must be integrated into your planning: processing a work permit often takes four to eight weeks, then an additional two to four weeks for the associated visa. Fees vary by duration and visa type, some reaching several hundred US dollars per year.
Spouses and dependent children can obtain dependent visas linked to the validity of your own permit. They do not automatically have the right to work: if they wish to engage in an activity, they must obtain their own work permit.
Access to Finance and Banking Reality
Even if well-capitalized, a foreign entrepreneur must deal with a particular financial environment. The banking system is dominated by a few commercial banks (e.g., Bank South Pacific, ANZ, Pan Oceanic Bank), conservative and focused on urban areas. The products offered remain classic (accounts, commercial loans, forex services, transfers), with few solutions adapted to very small businesses or rural projects.
Only about 15% of adults are banked. Branch closures in the provinces have further reduced access to financial services. Microfinance institutions remain embryonic, and public guarantee mechanisms or blended finance are virtually non-existent.
The major constraints for obtaining a local loan are:
– the lack of clear land titles, the majority of land being customary and thus difficult to mortgage;
– high interest rates;
– the absence of a domestic capital market;
– a low level of financial education in the population.
A significant advancement is the Secured Transactions Act, which allows the use of movable assets (boats, vehicles, agricultural equipment) as collateral, via an electronic registry. This reform has accelerated credit granting: some players now approve loans in one day, whereas it previously took weeks.
For small businesses affected by the health crisis, a specific product, the “Productive Sector Stimulus Package”, has been established: it offers loans between 10,000 and 2,000,000 SBD, for a maximum term of five years, with declining interest rates (8% on the first million, 13% on the balance) and a 20% equity requirement, which can take the form of “sweat equity” for farmers or real estate.
For an expatriate, some additional options exist:
Several avenues exist to raise funds and obtain financial support, ranging from direct investment to grants and competitions.
Capital injection from abroad, via the parent company or private partners.
Finding investors via global platforms like OpenVC, which aggregates thousands of business angels and venture capital funds.
Participating in competitions and programs (social innovation, tech startups, business plans…), sometimes open to Pacific businesses.
Securing grants via programs like Business Link Pacific, which can co-finance advisory services up to 30,000 NZD for SMEs with 50+ employees, with allocations for smaller structures.
The following table illustrates different possible funding channels.
| Funding Source | Main Advantages | Limitations / Conditions |
|---|---|---|
| Local banks (loans) | Local currency, track record with authorities | Collateral difficult, high rates |
| Productive Stimulus Package | Targeted conditions, regulated rates | Reserved for registered local businesses |
| Platforms like OpenVC | Access to international investors | Requires a scalable and structured project |
| Business Link Pacific grants | Partial funding for advisory services | Selection-based, caps per company size |
| Equity (investor funds) | Strategic control, no forced repayment | Dilution, sometimes lengthy negotiations |
In this context, arriving with a minimum of equity and a clear cash flow strategy is essential. Counting on local bank financing to launch a project from scratch is rarely realistic.
Infrastructure, Logistics, and Hidden Costs
The archipelago is located at a great distance from major global economic centers. International trade relies mainly on two main ports (Honiara and Noro) and one international airport. Roads are few and often in poor condition outside urban areas, and inter-island connections depend on boats with irregular schedules.
Logistics costs, including freight and customs, can reach several hundred dollars per container.
The cost and reliability of energy pose other challenges. Electricity tariffs are among the highest in the region, and load-shedding episodes can last several months, forcing businesses to resort to expensive diesel generators. A chamber of commerce survey showed that a large majority of companies saw their operational costs rise significantly due to power cuts.
For an entrepreneur, this implies: the ability to take risks, strategic vision, determination to overcome obstacles and aptitude for innovation.
– planning for generators and possibly renewable backup solutions;
– anticipating higher operating costs compared to other countries;
– maintaining safety stocks for critical inputs;
– carefully choosing the business location, for example near Honiara to limit logistics risks, or conversely in a strategic province for access to raw materials, at the cost of additional constraints.
Taxation and Reporting Obligations
The Solomon Islands tax system is known to be complex, with high compliance costs and a large number of annual payments. A typical company must deal with several types of levies: corporate tax, withholding tax on dividends, goods and sales taxes, customs duties, contributions to the National Provident Fund (SINPF), etc.
Several characteristics deserve highlighting for an expatriate:
Resident companies are taxed on their worldwide income, while non-residents are taxed only on their Solomon Islands-sourced income. There is no general capital gains tax, but the disposal of certain depreciable assets may generate taxable income. Dividends paid to non-residents are subject to a 30% withholding tax. The tax system includes neither VAT, wealth tax, nor inheritance tax. However, a tax applies on locally manufactured and imported goods, as well as a tax on certain sales of goods and services.
Payroll management requires the employer to withhold employee income tax according to a progressive scale that can reach 40% for the highest brackets, and to additionally deduct the employee’s share of SINPF contributions (about 5%), to which a minimum employer contribution of 7.5% is added.
Filing deadlines and tax payment deadlines in the Solomon Islands are strict, and penalties for delays can be significant. The complexity of the tax system is often difficult to grasp, especially for small businesses and foreign entrepreneurs. In practice, it is therefore essential to engage a local accounting firm accustomed to the rules and Solomon Islands specifics.
Customary Land, Property, and Community Anchoring
More than 80% to 90% of land in the Solomon Islands is governed by customary rules, under the control of clans and extended families rather than individual owners. This land can practically not be sold, and acquiring usage rights involves long-term leases negotiated with customary representatives (chiefs, elders, designated representatives).
This system has several consequences for an entrepreneur:
It is extremely difficult, if not impossible, to obtain a standard land title on customary land. Negotiations can be lengthy, involve multiple lineages, and require great cultural sensitivity. Furthermore, internal clan conflicts, sometimes latent, can emerge later if all stakeholders have not been properly consulted.
The state has undertaken pilot projects to record customary land via a Land Recording Act. But these mechanisms remain experimental and do not yet cover the entire country.
To secure the establishment of a project (tourism, agro-industry, energy), many investors prefer:
To develop an agricultural project, an investor has two main options. The first is to lease land from the state’s Perpetual Estate via Fixed Term Estates, which can be up to 75 years. The second involves establishing a partnership with local communities, for example by involving them in the capital of a ‘community company’ or via clear royalty payments, while integrating them into the project’s governance.
In all cases, it is highly recommended to engage local legal advisors familiar with both written law and customs, and to never artificially accelerate land negotiations at the risk of facing subsequent disputes.
Key Actors and Entrepreneur Support Ecosystem
An expatriate is not left alone. Several institutions support private sector development and can serve as entry points.
The Solomon Islands Chamber of Commerce and Industry (SICCI) is the umbrella organization for the formal private sector, with about 140 members. It runs sectoral groups (coconut, cocoa, manufacturing, SMEs), conducts regular policy dialogue with the government through a joint consultative group, organizes training, trade missions, networking events, and even has a brokerage team to connect agricultural product exporters (cocoa, coconut, ngali nut, timber) with international buyers.
SICCI contributed to the creation of the Young Entrepreneurs Council Solomon Islands (YECSI). Furthermore, initiatives like IumiWaka in Honiara offer entrepreneurs a coworking space and training.
The Solomon Islands Small Business Enterprise Centre (SISBEC) and its partners, including Business Link Pacific, offer capacity-building services for SMEs: support for grant applications, management training, workshops, coaching. Targeted grants are available for innovation, growth, inclusion, climate action, or access to finance.
Several international donor programs support businesses and agricultural value chains in the Solomon Islands. The Strongim Bisnis program, funded by Australia, co-invests in high-potential businesses in the tourism, cocoa, coconut, timber, and horticulture sectors, facilitating their market access and standards improvement. The PHAMA Plus program, funded by Australia and New Zealand, focuses on market access for agri-food products like cocoa and coconut, by strengthening quality standards, biosecurity, and compliance.
For an expatriate, connecting to these networks early on is a way to: facilitate integration, access useful information, develop a professional network, and support personal life in the new country.
– understand local practices faster;
– identify reliable partners;
– access certain grants or co-funding;
– carry more weight in dialogue with authorities.
Digital Specifics and Online Opportunities
The arrival of the Coral Sea submarine cable linking Honiara to Sydney has been a game-changer in terms of bandwidth, multiplied by a considerable factor. Investments in 3G/4G mobile networks have gradually covered a growing share of the population, although rural areas remain difficult to serve.
The internet usage rate is around 40 to 45% of the population and growing, while social media penetration is exploding, led by Facebook, followed by Instagram and, to a lesser extent, LinkedIn. Mobile connections represent the majority of access, with fixed broadband subscriptions virtually non-existent.
The government has adopted an ICT policy and created a Digital Transformation Authority. With UNDP support, a digital readiness assessment has been launched. These actions aim to develop e-government, digital payments, financial inclusion, and create an enabling environment for digital businesses.
However, the overall digital economy score remains modest (around 40%), reflecting still insufficient infrastructure, low local innovation, an ICT skills deficit, and the absence of comprehensive laws on electronic transactions, data protection, or cybercrime. The level of digital literacy is considered low, although basic skills and financial literacy are higher.
For a foreign entrepreneur, this means a dual reality: they must embody the innovative and ambitious vision of their project to attract investors and partners, while mastering the often complex administrative, legal, and cultural aspects of the host country to ensure the sustainability of their business.
– on one side, regulatory obstacles, still timid adoption of online payments (most customers prefer cash or cash on delivery), partial unavailability of international platforms (Stripe, PayPal), and nascent cybersecurity;
– on the other, a nearly virgin field for creating digital services adapted to the local context, working with telecom operators, the central bank, or NGOs: mobile money solutions, e-commerce platforms centered on Facebook, management apps for micro-businesses, etc.
Managing Risks: Instability, Climate, Security
Investing in the Solomon Islands is not just about facing slow procedures or poor roads. It also involves considering a series of macro and micro risks.
The country is emerging from a tumultuous period marked by political tensions, sometimes violent protest movements, and a long global health crisis. Authorities have adopted a national security strategy to better anticipate these threats, but some political volatility remains.
The region is highly exposed to climate hazards (cyclones, floods, sea-level rise, coastal erosion), which threaten infrastructure, supply chains, and tourism. Furthermore, the presence of unexploded ordnance from WWII in some areas constitutes an additional risk.
In terms of day-to-day security, risks include petty crime, some violent crime, and sometimes dangerous road conditions. Entrepreneurs must implement basic security protocols: securing premises, insurance, guidelines for night travel, prudent cash management.
On the social level, respect for customs, community structures, traditional leaders, and religious sensitivities is crucial. Behaviors deemed inappropriate in rural communities or failure to share promised benefits can quickly lead to tensions, even blocking a project.
How to Approach an Entrepreneurial Project as an Expatriate?
In summary, starting up in the Solomon Islands requires combining several qualities: patience, adaptability, financial strength, willingness for local anchoring, and an appetite for an environment still imperfectly structured but rich in opportunities.
A pragmatic approach could be structured as follows:
For a successful establishment in the Solomon Islands, it is recommended to start with exploratory visits on a short-stay visa to meet local actors, validate the project idea, visit potential sites, and understand import/export circuits and market realities. It is crucial to establish early links with local institutions such as SICCI, SISBEC, Business Link Pacific, and InvestSolomons, and possibly with legal or accounting firms. Prioritize an initial location in Honiara or near a logistics hub (port, airfield) before considering expansion to the provinces, which are more complex but rich in resources. Objectively assess your capacity to handle high energy costs, long logistics delays, and demanding administrative procedures. Integrate a reasonable level of equity into your financial structure, considering local loans as a complement rather than the foundation of the project. Finally, anticipate immigration-related procedures (visas, work permits) and do not underestimate the associated lead times.
The Solomon Islands are not a “plug-and-play” destination for entrepreneurship. Yet, for those willing to embrace the local pace, ally with communities, and bet on sectors where the archipelago has a natural advantage – niche tourism, agricultural and fishery products, clean energy, services adapted to the island context – there is real space to create solid businesses, aligned with the country’s needs and the development trajectory desired by the authorities.
Starting a business in the Solomon Islands is therefore also choosing a long-term project, built with and not just “in” the country.
Business Creation in the Solomon Islands
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