World Bank approves $2 million grant and credit for Tonga growth [1]
Wednesday, March 23, 2016 - 14:50
US$2 million in concessional financing approved by the World Bank on 16 March will support Tonga’s efforts to create a more inclusive and resilient economy through policy reform.
The World Bank said in a statement that Tonga's First Inclusive Growth Development Policy Operation is the first in a series of three development policy operations.
This is to assist the Tongan Government to deliver reform to support fiscal resilience through strengthened budgetary policies, promote inclusiveness and government accountability through new public procurement regulations, improved government audit responses and a new regulatory framework in the ICT sector.
It is also aimed towards an inclusive economy by adopting "investor friendly foreign investment regulation", extending coverage to the credit bureau and encouraging more private sector participation in public enterprises.
The reform program is also expected to directly address hardship by targeting the high cost of basic goods through more effective regulation, reinforcing incentives for healthy living and encouragement of a business environment conducive to more jobs and income earning opportunities.
The Minister of Finance and National Planning Hon ‘Aisake Eke said the Tongan Government is committed to this reform program, which over of the course of this government usher in new major transformations to support improved government effectiveness, jobs and a strong inclusive society.
Franz Drees-Gross, World Bank Director for Timor Leste, PNG and Pacific Islands said the program is designed to boost growth to support shared prosperity and improve economic prospects for women and vulnerable groups.
This operation is part of an ongoing policy partnership that has been supported by the World Bank development policy operations in Tonga in each of the last five years.
It is funded with US$1 million credit and US$1 million grant from the International Development Association, which is the World Bank's fund for the poorest countries.
Meanwhile, Australia, Asian Development Bank and European Union are all expected to provide budgetary support to Tonga in the coming year as part of the same policy framework.