Cook Islands : Supporting Sustainable Economic Recovery Program

Sovereign Project | 55014-001

1. The Supporting Sustainable Economic Recovery Program will help the Cook Islands restore fiscally sustainable growth led by the private sector, which has been adversely affected by the coronavirus disease (COVID-19) pandemic. The program aims to (i) improve fiscal management and sustainability and (ii) strengthen the enabling environment for the private sector. It aligns with Asian Development Bank (ADB) Strategy 2030 operational priorities of strengthening governance and institutional capacity, accelerating progress in gender equality, and fostering regional cooperation and integration. It is consistent with the country operations business plan for Eleven small Pacific island countries, 2021-2023 and Pacific Approach, 2021-2025.

Project Details

  • Project Officer
    Webb, James M.
    Sectors Group
    Request for information
  • Country/Economy
    Cook Islands
  • Sector
    • Public sector management
Project Name
Supporting Sustainable Economic Recovery Program
Project Number
55014-001
Country / Economy
  • Cook Islands
Project Status
Closed
Project Type / Modality of Assistance
  • Grant
  • Loan
Source of Funding / Amount
Grant: Supporting Sustainable Economic Recovery Program
Source Amount
New Zealand Grant US$ 21.20 million
Loan 4161-COO: Supporting Sustainable Economic Recovery Program
Source Amount
Ordinary capital resources US$ 40.00 million
Loan 4162-COO: Supporting Sustainable Economic Recovery Program
Source Amount
Ordinary capital resources US$ 40.00 million
Operational Priorities
  • OP1: Addressing remaining poverty and reducing inequalities
  • OP2: Accelerating progress in gender equality
  • OP6: Strengthening governance and institutional capacity
  • OP7: Fostering regional cooperation and integration
Sector / Subsector
  • Public sector management / Economic affairs management - Public administration - Public expenditure and fiscal management

Gender
Effective gender mainstreaming
Description

1. The Supporting Sustainable Economic Recovery Program will help the Cook Islands restore fiscally sustainable growth led by the private sector, which has been adversely affected by the coronavirus disease (COVID-19) pandemic. The program aims to (i) improve fiscal management and sustainability and (ii) strengthen the enabling environment for the private sector. It aligns with Asian Development Bank (ADB) Strategy 2030 operational priorities of strengthening governance and institutional capacity, accelerating progress in gender equality, and fostering regional cooperation and integration. It is consistent with the country operations business plan for Eleven small Pacific island countries, 2021-2023 and Pacific Approach, 2021-2025.

2. A policy-based loan of $80 million is proposed to support the government's ongoing reform program to restore longer-term economic growth and fiscal sustainability while meeting urgent development financing needs. A single tranche stand-alone policy-based loan is considered appropriate since the economic recovery is uncertain, and the Cook Islands does not routinely use loans to meet development finance needs because of debt sustainability considerations. An initial drawdown of $40 million in 2021 will meet the Cook Islands' immediate financing needs. Since financing needs will be largely determined by the degree to which a tourism recovery can be sustained, the remaining $40 million will be made available for potential future drawdowns based on pre-defined conditions, through a precautionary financing option (PFO).

Project Rationale and Linkage to Country/Regional Strategy

The Cook Islands' population of about 17,580 (in 2020) is spread across 15 remote South Pacific islands and two million square kilometers of ocean. It is one of the region's

most tourism-dependent countries, with receipts of 61.4% of gross domestic product (GDP) in fiscal year (FY) 2019. The shift towards tourism has led to rapid development, with basic needs poverty falling from 28.4% in 2006 to 8.4% by 2016. Growth is hampered by factors including a small population, narrow economic base, high exposure to disaster and climate risks, weak business climate, capacity constraints, and high public administration and infrastructure costs. The Cook Islands has no access to international or local credit markets, is not a member of the International Monetary Fund (IMF) or World Bank and does not have a central bank to provide emergency liquidityleaving very limited options for support should the nascent recovery unwind.

Impact

Working together to build a dynamic, prosperous and inclusive economic future for Cook Islanders, that is in harmony with our culture and environment (Cook Islands Economic Development Strategy 2030).

Project Outcome

Description of Outcome

Fiscally sustainable private sector-led economic growth in the Cook Islands restored.

Progress Toward Outcome

Implementation Progress

Description of Project Outputs

Fiscally sustainable private sector-led economic growth in the Cook

Islands restored.

Status of Implementation Progress (Outputs, Activities, and Issues)
Geographical Location
Nation-wide

Safeguard Categories

Environment
C
Involuntary Resettlement
C
Indigenous Peoples
C

Summary of Environmental and Social Aspects

Environmental Aspects
Involuntary Resettlement
Indigenous Peoples

Stakeholder Communication, Participation, and Consultation

During Project Design
During Project Implementation
Actual disbursement as of 21-Dec-2021: 37,767,000.000

Contact

Responsible ADB Officer
Webb, James M.
Responsible ADB Department
Sectors Group
Responsible ADB Division
Public Sector Management and Governance Sector Office (SG-PSMG)
Executing Agencies
Ministry of Finance & Economic Management

Timetable

Concept Clearance
11 Sep 2021
Fact Finding
02 Sep 2021 to 14 Sep 2021
MRM
20 Oct 2021
Approval
10 Dec 2021
Last Review Mission
-
Last PDS Update
24 Oct 2022

Funding

Loan 4161-COO

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
10 Dec 2021 14 Dec 2021 16 Dec 2021 31 Dec 2024 - 06 Jul 2022
Financing Plan
  Total (Amount in US$ million)
Project Cost 40.00
ADB 40.00
Counterpart 0.00
Cofinancing 0.00
Loan Utilization
  Date ADB Others Net Percentage
Cumulative Contract Awards 29 Jan 2024 37.77 0.00 100%
Cumulative Disbursements 29 Jan 2024 37.77 0.00 100%

Loan 4162-COO

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
10 Dec 2021 14 Dec 2021 16 Dec 2021 31 Dec 2024 - -
Financing Plan
  Total (Amount in US$ million)
Project Cost 40.00
ADB 40.00
Counterpart 0.00
Cofinancing 0.00
Loan Utilization
  Date ADB Others Net Percentage
Cumulative Contract Awards 29 Jan 2024 0.00 0.00 0%
Cumulative Disbursements 29 Jan 2024 0.00 0.00 0%

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

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Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

None currently available.


Evaluation Documents See also: Independent Evaluation

None currently available.


Related Publications

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Tenders

No tenders for this project were found.

Contracts Awarded

No contracts awarded for this project were found

Procurement Plan

None currently available.