Tonga Gov Fund For Low Interest Private Sector Loans

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Part of gov plan to drive domestic and foreign investment

NUKU‘ALOFA, Tonga (Matangi Tonga, August 25, 2014) – Low interest loans will be available to the Private Sector from a new government fund that is being managed through the Tonga Development Bank, the Ministry of Finance and National Planning announced today.

In a statement, the ministry said that on August 22 the Tongan Government had concluded with the Tonga Development Bank (TDB) the Implementation Agreement for the management of lower cost credit Government funds towards priority sectors. The Agreement details the implementation arrangement for the managed funds up to a total of $13 million Pa’anga [US$7,031,000] that will be on-lent at 1 percent and 4 percent to the private sector who meet certain criteria.

"The Government through the managed funds by TDB continues to put focus on supporting the development of the private sector as the engine of growth as one of its priorities in the 2014/15 Budget Statement and Estimates," the ministry stated.

The Minister for Finance and National Planning ‘Aisake Eke emphasized that "greater growth will create more employment opportunities for families and help increase their income to meet daily needs, at the same time raise government revenue so it can provide more services expected by the public. This is part of a series of government-led initiatives including the Investment Incentives launched recently which aims to expand private investment and to make Tonga an attractive destination for both domestic and foreign investment by enacting investor friendly policies, introducing new incentives to key growth areas and facilitating ease of doing in business."

The CEO for the Ministry of Finance and National Planning Tatafu Moeaki together with Leta Kami, Managing Director and CEO for Tonga Development Bank, signed the agreement.

It is understood that the Tonga Development Bank will apply the funding to new low-interest loans that meet certain criteria and that the government fund will not be applied to rescheduling existing loans.

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