The World Bank provides financial support to economically struggling countries through interest-free loan or grant aid. Recently, it has also been pursuing public-private partnerships (PPP; Public Private Partnership) that support infrastructure projects with public institutions and private companies. A project to build a hydroelectric dam in the Solomon Islands is a representative PPP project.
The World Bank, together with the Asian Development Bank (ADB) and the Economic Development Cooperation Fund (EDCF), financed 95% of the total project cost of $272 million (about 400 billion won) through a mix of grants and non-grants. Korea Water Resources Corporation (K-water) and Hyundai Engineering will cover the remaining 5%, and once the dam is completed in 2028, they will supply electricity and generate revenue.
World Bank energy specialist Yulia Zakrevskaia said, "The hydroelectric dam project will not only reduce electricity rates in the Solomon Islands by 30% to 40% but also create new jobs for the country, provide opportunities for technological advancement, and drive national economic growth."
An energy specialist at the World Bank oversees and supports technology and operations so that developing countries can use stable, affordable, and clean energy.
Kaia expected the hydroelectric dam project to accelerate the pace of economic development in the Solomon Islands. According to the Central Bank of the Solomon Islands, the country's nominal gross domestic product (GDP) was $1.28 billion (about 1.9 trillion won) as of 2022. Its main industries are agriculture, forestry, and fisheries, and economic growth has been stagnant for years.
Kaia said, "The process of building and operating the Tina Dam will raise the skill levels of the local workforce." The Tina Dam is operated under a BOOT (Build Own Operate Transfer) model. Korean corporations will operate it for 30 years after the dam's construction is completed, generate revenue, and then transfer the project to the government. The World Bank expects that, as Korean corporations transfer the project, they will train local workers in the Solomon Islands and pass on technology.
The World Bank also said it expects the project to increase employment of women in the Solomon Islands. The World Bank required the dam builder to hire women for 30% of the total workforce engaged in the construction project, and about 20% has been achieved at the Tina Dam site. The World Bank plans to carry out various training programs for local communities to secure additional women workers needed for dam construction.
Meanwhile, the World Bank plans to focus on improving the Solomon Islands' vulnerable water management infrastructure in the future. Despite abundant rainfall, the Solomon Islands lacks purification facilities and faces difficulties in securing drinking water. Kaia said, "The World Bank is supporting the Solomon Islands government in developing strategies and strengthening its capacity to solve water-related problems," adding, "We look forward to working with capable private corporations on related projects in the future."