The Government says delays in major infrastructure projects caused by the national border closure are behind a major decline predicted for the nation's economy this year.

Ministry of Finance Chief Executive Officer Leasiosiofaasisina Oscar Malielegaoi said several projects have been fully financed which led the Government to believe they would begin and contribute to an economic upswing.

“We were optimistic in the beginning but some may not happen […]there are things beyond our control that will stop us from starting those projects immediately," he said. 

Leasiosio said while M.O.F. has done its part to secure funding, implementing agencies are coming up against problems that cannot be easily solved:

“I don’t blame ministries and agencies because they are faced with multiple challenges. One is the unavailability of expertise who should have been on island by now.”

Leasiosio said the Government had hoped that between July and September last year it could bring in technical expertise from abroad, but decided not to make travel exemptions for them after all.

With the pandemic only worsening in many countries, and new variants of the virus emerging out of the United Kingdom, South Africa and Brazil, Samoa won’t be bringing in experts if it can be avoided, the C.E.O. said.

“Because of the safety aspect, we decided against providing special exemptions. With the new variant we have to be very careful," Leasiosio said. 

Following its latest analysis on Samoa’s economy, the International Monetary Fund predicts gross domestic product to contract by 8.5 per cent this year before recovery begins in 2022, with forecast growth of 2.9 per cent.

That increase in economic output is predicted to continue into the 2022-2023 fiscal year and beyond, reaching 3.5 per cent the next year but dipping down again to 2.1 per cent in the 2025-2026 fiscal year, according to the I.M.F.

But some infrastructure projects will be able to go ahead and hopefully contribute to that growth, the Finance Ministry chief said.

The Land Transport Authority is pressing on with the West Coast Road developments, and work can begin soon on the Cross Island Road improvements, fully funded by the Asian Development Bank.

But issues relating to compensation and environmental studies need to be wrapped up first, Leasiosio said. 

However the Chinese Government grant-funded Police Academy and Vaisigano Catchment river wall developments and Lelata bridge improvements will be significantly delayed, Leasiosio said.

In its report, I.M.F. recommends Samoa continue providing economic stimulus until 2024 when it predicts the country will begin seeing pre-COVID-19 economic activity. 

Leasiosio said he values the recommendation, but whether the Government continues spending this way will depend on the global and regional situation.

“I don’t want to pre-empt anything. We all thought in the beginning that finding a vaccine would be the main challenge," he said. 

"Now we have a vaccine, the problem is distribution. 

“We don’t know when we will all be getting 100 per cent immunisation. If all goes well and all countries get that by the end of this year then next year may be a different scenario, we might not need a stimulus package next year if the economy recovers to pre-COVID-19 level.”

Meanwhile, he confirmed Phase 3 of the Government's stimulus package is currently in the works and will likely be released in May, or as part of the next annual budget in July. 

He would not give details as to which sectors or groups might benefit from the relief package, but said that the Government is looking at “some productive investments".

“We are looking at the most effective stimulus activities," he said. 

"We don’t want to just give out money that will just meet some of the needs, but it won’t go as far as we should be looking at.”

He would not disclose whether the tourism sector would receive more help in the next package, saying only that the stimulus programme will be dependent on the availability of resources.