Marshall Islands Finance Minister Brenson Wase delivered a statement on behalf of the 15 Pacific Developing Member Countries (DMCs) of ADB during the 2019 Pacific Governors’ Meeting with Asian Development Bank President Takehiko Nakao, who co-chaired the meeting alongside Wase.
Wase highlighted two emerging issues: first, concerns on the European Union’s unilateral and non-transparent blacklisting of several Pacific countries, and second, collaboration with Pacific DMCs and development partners to amicably resolve issues of de-risking and withdrawal of correspondent banking relationships.
The DMCs “strongly encourage ADB to consider options to extend more concessional resources for highly vulnerable small island states currently eligible only for OCR lending,” he continued. OCR refers to “ordinary capital resources,” one of a series of classifications to determine eligibility of DMCs to borrow money or receive grants.
Wase urged ADB consideration of this through a combination of:
• Differential OCR pricing.
• Country reclassification, as the World Bank has recently announced for Fiji and special consideration should be given to extremely vulnerable non-World Bank Pacific members.
• Extending concessional resources to build climate resilience in vulnerable countries or after a major shock or disaster, similar to the way ADB agreed last year to provide grant funding to help Bangladesh respond to the Rhongya crisis.
Wase further expressed the support of Pacific island countries on the launch of the Healthy Oceans and Sustainable Blue Economies Action Plan. It is ADB’s intention to commit $5 billion in new financing for blue economy, reducing marine pollution, protecting and restoring marine ecosystems, and “greening” ports and marine infrastructure. Considering debt distress for small islands developing states (SIDs), DMCs recognized and thanked ADB’s engagement to address debt distress in advance of financing for vulnerable SIDs in that ADB. Currently, ADB provides 100 percent grants for seven countries — including the RMI — and 50 percent grants for an additional two. Furthermore, the increase in the Asian Development Fund base allocations from $6 million to $13 million per annum for this year and next has also helped such smaller, more vulnerable Pacific countries, Wase said.
In response, Nakeo stated, “We now have the opportunity to highlight the unique development challenges in the Pacific, as well as to showcase the significant development progress throughout the region. There are local challenges, as Mr. Wase mentioned, especially climate change, but opportunities coming from new technologies are helping to (address) the remoteness of island countries.”
In essence, ICT cables for Palau, Samoa, and Tonga have reduced internet costs by two thirds.
Read more about this in the May 10, 2019 edition of the Marshall Islands Journal.