ADB Emergency Loan to Help Rebuild Fiji's Flood-Affected Rural Economy

MANILA, PHILIPPINES - The Asian Development Bank (ADB) is extending an emergency loan of $17.6 million to help rebuild damaged infrastructure and revive economic activity in rural areas of Fiji that were badly affected by floods earlier this year.

The Board of Directors approved the assistance which will be used to rehabilitate roads, bridges, and other infrastructure, particularly on Viti Levu, Fiji’s main island. Heavy rains last January caused serious flooding in many regions, including the agriculturally-rich Sigatoka Valley and around Nadi town. The floodwaters forced thousands of people to temporarily evacuate their homes, destroyed crops causing a spike in food prices, and damaged roads, schools, medical facilities and water and sanitation systems.

"The floods have made life much harder for rural people, who were already living below the poverty line, and the rehabilitation of roads, bridges, and water supplies is essential for sustaining economic activities," said Keith Leonard, Regional Director of ADB's Fiji Office.

Ensuring access to markets is a major priority, particularly for the many poor rural dwellers, including women, who grow and sell vegetables for their livelihoods.

"The project will also boost continued access to health and education services, and the delivery of safe water to rural villages," said Richard Phelps, Infrastructure Specialist of ADB's office in the Fiji Islands.

Climate proofing is a key feature of the project, with damaged infrastructure to be rebuilt to better withstand extreme events in future. Low-lying Pacific Island nations are considered to be among the most at risk from projected spikes in sea levels and natural disasters linked to climate change.

The loan, to be sourced from Ordinary Capital Resources, has a 32-year term with an 8-year grace period, and interest charges determined by ADB’s LIBOR-based lending facility. The Government of Fiji will provide support equivalent to around $2.4 million, for a total project cost of almost $20 million. The executing agency is the Ministry of National Planning and the estimated project completion date is August 2011.