A large portion of Fiji’s $200 million concessional financing from the Asian Development Bank will go towards capital development projects, while part of the funding will also be used to help mitigate the ongoing fuel crisis.
Minister for Finance Esrom Immanuel made these comments in Parliament while responding to questions on the country’s financing arrangements with the ADB.
Immanuel says the financing is expected to support critical infrastructure, strengthen foreign reserves and cushion the upcoming national budget.
He says the Asian Development Bank remains Fiji’s largest external lender, with outstanding loans of around US$608.6 million, equivalent to approximately $1.356 billion at the end of April.
The Minister says current ADB financing supports transport infrastructure, water supply, sanitation, cyclone emergency recovery and policy-based budget support operations, while future financing proposals include health, bridges and other major infrastructure projects.
Immanuel says around 21 percent of ADB borrowing is concessional, with repayment terms of up to 40 years, including a 10-year grace period and interest rates between one and two percent.
He also acknowledged the ADB Board’s decision to reclassify Fiji from a Group C to a Group B country from January 2022 and extend soft lending terms to Small Island Developing States, including Fiji.
Immanuel says these arrangements allow Fiji to access financing on more favourable terms than commercial borrowing.
Member of Parliament Alipate Tuicolo asked what percentage of the concessional loans would go towards capital and operational expenditure.
In response, Immanuel says the Government had not yet calculated the percentages but confirmed that the bulk of the financing would be used for capital development, while some would assist with fuel crisis mitigation measures.
