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Asian Development Bank earmarks loans

By Nellie Setepano PORT MORESBY, Papua New Guinea (PNG Post-Courier, July 7, 2010) – Asian Development Bank is expected to see almost 20 percent of loans and grants over the next three years being directed to the power sector within the Pacific, delegates from major energy companies in the region were told yesterday.

Energy specialist with the Asian Development Bank Robert Kersterton said most of its activities had been heavily skewed towards infrastructure development with transport, power and water receiving almost 80 percent of all loans by grant value. "Transport has been our largest sector and we expect to continue. However we also expect to see almost 20 percent of loans and grants over the next three years being directed to the power sector," he told the 19th Pacific Power Association meeting in Port Moresby.The meting was told that the bank is implementing a portfolio of about 50 loan grant projects across a range of sectors in the 14 ADB member pacific nations.

These are current projects with 31 active loans worth US$676 million (PGK20 billion), 17 active grants worth US$162 million (PGK480 million) and 63 active technical assistance projects worth US$100 million (PGK296 million).

There were 38 grants/loans worth US$855 million and 65 technical assistance projects worth US$83 million as pipeline projects.

The energy specialist said ADB is also involved with a number of renewable projects in PNG with recent feasibility studies for six provincial hydropower projects.

A discussion with PNG Power Limited has been discussed for a loan worth US$1.2 million (PGK3.5 million) to assist with implementation. "In terms of energy efficiency, we are supporting a regional initiative in Cook Islands, PNG, Samoa, Tonga and Vanuatu. This will recommend policy and regulatory measures to promote energy efficiency, implement a pilot project in each country, and help prepare a much larger project to be financed by the Global Environment Facility," Mr Kersterton said.

He said ADB had recently adopted a new strategy in the Pacific, called the "Pacific Approach", which is meant to take into account global developments such as climate change and the global financial crisis.

As well as identifying future cross sector priorities such as improved private sector engagement and better public sector management, it also identifies four priority areas in the Pacific. These have been identified as transport, energy, urban development and education.

Energy is therefore a top four priority for ADB in the Pacific and our aim is to concentrate heavily on the power sector in the future.

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