22 Aug 2003

Solomon Islands bows to Australian ultimatum on bank appointment

4:38 pm on 22 August 2003

The former head of the Solomon Islands' Central Bank, Rick Hou, is expected to be reappointed following an ultimatum from the Australian-led intervention force.

The deputy governor of the Central Bank, Denton Rarawa, says the Solomon Islands' Cabinet has recommended to the Governor-General that Mr Hou be reappointed, and he expects this to occur.

Mr Rarawa confirmed that the intervention force told the Government that if Mr Hou -- whose term ended three days ago -- was not reappointed it would find its own candidate from outside the country.

"They have indicated that if he is not reappointed then an expatriate would be reappointed, so I think that played a key factor in the reappointment process."

Mr Rarawa says he understands Mr Hou has said he will continue as long as the Government supports him, which it has now shown it does.

And he says the reappointment is necessary to maintain confidence in the policies of the Government and activities of its main bank.