Multi million dollar ADB loan and grant agreement signed to deal with wastewater and water leakage

To address the major water supply and wastewater woes due to the rapid urban expansion, the Fijian Government has today signed a $304 million concessional loan and $23 million grant agreement with the Asian Development Bank.

While speaking at the signing ceremony, Acting Prime Minister and Minister for Finance, Professor Biman Prasad said the “Healthy Oceans and Water Supply Improvement Project” is a $385 million project which will double the treatment capacity of the Kinoya Wastewater Treatment Plant, support financing of a performance-based contract for non-revenue water or leakage reduction and improve regional capacity and training in the water and wastewater sector.

Of the full project cost of $385 million, the ADB is providing a concessional loan of $304 million with a loan term of 40 years inclusive of a 10-year grace period and interest rate of 1 percent, a 100 percent grant of $23 million for regional training and capacity development and the Government of Fiji will make a local contribution of $59 million in terms of taxes and import duties etc.

Professor Prasad says $29 million is allocated to focus on efficiency and reliability of water supply services.

The 5-year contract aims to reduce non-revenue water levels in the Greater Suva Area to an average level of 20 percent.

$101.8 million will be used to finance the upgrading of the Kinoya Wastewater Treatment Plant to a capacity of 180,000 equivalent population, which is expected to meet the demand until 2035 in the Kinoya catchment area.

Professor Prasad says in simple terms, they are doubling the capacity of the Kinoya Wastewater Treatment Plant.

This project has been in preparation for the last 2 years and is now ready for implementation.

Professor Prasad adds our water and wastewater sector faces some major challenges including old aged infrastructure resulting from years of under-investment and lack of proper asset maintenance.

It has been highlighted that Fiji has a very high level of water leakage which is estimated to be 48 percent.

This means that almost half of the treated water doesn’t reach our taps as it gets leaked out.

Professor Prasad says the wastewater infrastructure has been operating beyond capacity posing a major threat to our environment and our oceans.

He says in fact, we have major capacity challenges with the current sewerage infrastructure which is not able to support any major economic development in the country; and there are human resource challenges in the water and wastewater sector with an urgent need for long term capacity development.

Professor Prasad clarifies that this ADB borrowing is within their fiscal targets and investment focus area.

At the end of July 2025, Government’s total debt stood at around $10.8 billion, equivalent to 77.1 percent of GDP.

Debt is projected at $11.7 billion or 79.8 percent of GDP by the end of July 2026.