[Source: Fiji Government/ Facebook]

The Asian Development Bank has unveiled favourable lending terms for Small Island Developing States to boost investments in climate initiatives and other global public goods.

Bank President Masatsugu Asakawa announced this following his meeting with Finance Minister Professor Biman Prasad.

The terms feature a 1 per cent interest rate, a 10-year grace period, a 40-year maturity, and initial principal repayments of two per cent annually for the first decade post-grace period, escalating to four per cent thereafter.

Asakawa says this move will help mitigate SIDS’ debt service obligations, intensified by pandemic fallout.

SIDS beneficiaries include Cook Islands, Fiji, Niue, Palau, Papua New Guinea, Solomon Islands, Timor-Leste and Vanuatu.

Solomon Islands and Vanuatu additionally qualify for ADB grants, aligning with the bank’s commitment to supporting vulnerable developing nations.

ADB adds that strategic shift in financing aims to address SIDS vulnerabilities and promote investments in global public goods, aligning with ADB’s broader agenda in line with multilateral development banks.