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NUKUALOFA, Tonga (Matangi Tonga, April 27) – The Tonga government is seeking a loan of 60 million Tonga pa’anga [US$29.4 million] from China to buy back the Shoreline Power's electricity assets.

Tonga Prime Minister Dr Feleti Sevele asked the Chinese Premier Hon. Wen Jiaobao, on April 5 in Fiji, for the loan as part of a complex multi-million pa'anga proposal under negotiation by the two countries.

At a bilateral meeting with Dr Sevele, the Chinese Premier outlined the People's Republic of China aid package for Tonga, which includes millions of pa'anga in grants, and soft loans, and millions more for the construction of airports, school and a wharf.

There is a Special Grant of 12 million Tonga pa’anga [US$5.8 million] to balance Tonga's forthcoming budget and an unspecified grant for the construction of a Convention Centre, and a soft loan for the refurbishing of the Dateline Hotel - and for the purchasing of new vehicles for the Pacific Forum Meeting to be held in Nuku'alofa later this year.

The Chinese have also agreed to extend and upgrade the Fua'amotu International Airport, and to either extend or relocate the Vava'u airport, and to build a new wharf for Vava'u.

In the pipeline is a joint venture between Tongasat and a Chinese Satellite company. There will be on-going discussions between the two countries with regards to the launching of a satellite into the Tongasat's 130 degrees East longitude orbital position.

During the first China-Pacific Leaders Forum that was held in Nadi, Fiji on April 5-6, Dr Sevele accepted the first part of the Chinese aid to Tonga, a 3.8 million Tonga pa’anga [US$1.8 million] grant.

He also signed an agreement for the construction of the Tonga High School Phase II Project.

Besides the Chinese bilateral aid package with its Pacific island friends it will also provide 3 billion yuan [US$374.8 million] of preferential loans to Pacific island countries during the next three years for the development of agriculture, forestry, fishery, tourism, textiles and consumer products manufacturing, telecommunications, aviation and ocean shipping.

For least developed countries in the region with diplomatic ties with China, it will cancel their debts that matured at the end of 2005, and the payment of debts contracted to be extended by ten years.

The first China-Pacific Island Countries Economic Development and co-operation Forum was attended by representatives from ten Pacific Island countries, including New Zealand and Australia.

May 1, 2006

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