Fiji and Japan have formalized a $72 million Stand-by Loan agreement for the second phase of the Disaster Recovery and Rehabilitation project. This initiative aims to bolster the government’s strategy on disaster risk reduction and management.
The loan is designed to help meet the heightened financial demands that arise in the aftermath of a disaster, allowing the Fijian government to request funding for recovery efforts soon after a natural disaster is declared. The primary goal of this stand-by loan is to support Fiji’s economic stabilization and development, particularly by enhancing its disaster risk management capabilities and facilitating post-disaster recovery.
Deputy Prime Minister and Finance Minister Professor Biman Prasad announced that this concessional financing plan features a 40-year repayment term, including a 10-year grace period and an interest rate of 0.4 percent per annum. He noted that funds will be accessed only if a significant natural disaster occurs and is officially recognized by the Cabinet.
Professor Prasad acknowledged the Japanese government’s significant financial contributions through the Asian Development Bank (ADB) in various sectors, including infrastructure, education, health, and disaster response in Fiji. He mentioned that the initial phase of disaster financing was utilized for recovery efforts following Tropical Cyclone Harold in 2020.
Japanese Ambassador to Fiji, Rokuichiro Michii, expressed that this concessional loan underscores the enduring Fiji-Japan partnership, with a focus on disaster response and risk reduction. He reiterated the Japanese government’s ongoing commitment to supporting Fiji’s development through official development assistance.
Ambassador Michii further indicated that the agreement for this concessional loan is part of a series of five exchange notes anticipated to be signed in the next few weeks, which collectively could amount to approximately $133 million.