27 Nov 2006

ADB cancels planned loan to Marsall Islands

5:51 am on 27 November 2006

The Asian Development Bank has cancelled a long-planned loan of nearly 8 million US dollars to the Marshall Islands because of problems in repaying current loans.

An officer for the bank in the Marshalls, Stephen Pollard, said the loan was intended to be used for improving

channels and harbors, navigational markers and other transportation-related aids for far-flung islands.

About a third of the country¹s 58,000 people live away from the main islands.

But since the loan was approved in 2002, costs for the project have increased substantially and there has been a shortfall in funding to have been supplied by the Marshalls.

The ADB says no new loans are planned until the country strengthens public institutions and governance and addresses continuing loan arrears.