NUKU’ALOFA, TONGA – The Asian Development Bank (ADB) will help the Government of Tonga in its efforts to achieve fiscal stability and improve the country’s long-term growth prospects through a policy-based program grant.
“The Strengthening Public Financial Management Program will support the government’s efforts to redirect spending to more productive sectors of the economy, improve investor confidence, and create the fiscal room needed to respond to future economic or climatic shocks,” said Lai Tora, ADB economist and team leader for Tonga.
ADB is providing a grant of $4.5 million sourced from ADB’s Special Funds to help finance the program.
ADB and other development partners such as the Government of Australia, the European Union, the International Monetary Fund, the New Zealand Aid Programme, the Pacific Financial Technical Assistance Centre, and the World Bank have helped the government prepare a multi-year joint policy reform matrix for budget support, which outlines shared reform priorities and has helped implement reforms.
ADB’s assistance will have a strong focus on sustained economic growth, capacity development, and private sector development in line with the Tonga Strategic Development Framework, 2011-2014, the government’s national development strategy.
The program will assist the government in improving program budgeting and public procurement, introduce small business and deep sea mining tax regimes, advance the government’s plans for private sector participation in the International Dateline Hotel and Tonga Communications Corporation, strengthen state-owned enterprise corporate governance, and reform business licensing processes.