The International Fund for Agricultural Development (IFAD) will provide a US$3 million grant to the Kingdom of Tonga to improve sustainable livelihoods for vulnerable rural communities.

The grant agreement for the Rural Innovation Project was signed today by Sione Ngongo Kioa, Ambassador Extraordinary and Plenipotentiary to Rome and IFAD of the Kingdom of Tonga, and Iain Kellet, Chief Financial Officer of IFAD.

In Tonga, the economy is vulnerable. Particularly in rural areas where employment opportunities are few, accesses to markets are limited and transportation costs are high. In addition, there is a constant flow of outward migration. About 70 per cent of the population lives in rural areas and depends on agriculture and fisheries for their livelihoods. Generally, rural poverty is concentrated among smallholder farmers and small-scale fishers, practicing a mixed subsistence and cash-crop production. A typical rural farming household produces coconut and root crops, such as taro, yam and sweet potato, which are sometimes supplemented by plantains and bananas.

The Rural Innovation Project will scale up the successful Mainstreaming of Rural Innovation Programme (MORDI) implemented in Tonga by the local non-governmental organization MORDI Tonga Trust. The project will strengthen the capacity of targeted communities and businesses to plan, finance and manage their development priorities in order to improve sustainable livelihoods. Focus will be on supporting the implementation of community development plans, and providing grants for community infrastructure for rehabilitation, or construction and maintenance. Links will be established with commercial banks to provide critical financing to agriculture enterprises and rural businesses to stimulate investment in rural economies.

The project will be implemented within all regions of Tonga in 29 communities in the “outer islands” (outside the main islands of Tongatapu, Vava'u and Ha’apai) and 31 communities in the “main islands” of Tongatapu, Vava’u, Ha'api the Niua’s and ‘Eua. Approximately 16,900 poor households will be targeted, with special attention to poor rural women who are particularly vulnerable to poverty. – IFAD, 25/05/12.