10 Dec 2009

ADB hopes grant will help Tonga recover from financial crisis and boost economy

3:09 pm on 10 December 2009

The Asian Development Bank says it hopes a 10 million US dollar grant to Tonga will help the government recover from the effects of the global financial crisis and boost its economy.

The ADB approved the grant last week for an Economic Support Programme to assist the Tonga Government in its financial hardships.

A senior country specialist economist, Emma Ferguson says the ADB is helping Tonga cut costs in its budget and to help prevent a projected fiscal deficit for the current financial year to June next year.

"The grant in and of itself will not be a complete solution to the fiscal deficit that the government has proposed. Government will need to take a mixture of actions including cutting back some of its proposed expenditure and also looking to other development partners to provide financial assistance to support their budget expenditure."

Emma Ferguson says the ADB is now expecting Tonga's economy to recover substantially and faster than expected.