Tongan default deferred

Tongan prime minister Lord Tu’ivakano announced an extension of the grace period for a loan of over USD 60 million only days before its first payment of nearly USD 7 million was due. The loan, from the Exim Bank of China, was used to rebuild roads and infrastructure in Nuku’alofa, the capital, following the 2006 rioting that destroyed much of the town. The IMF states that the loans account for about 60% of Tonga’s external debt load, and ‘pose an excessive exposure to a single foreign currency.’

Lord Tu’ivakano told parliament that his government had requested an additional 5 to 10 year extension, but that the Exim Bank had yet to make a final decision on the time frame.

This article was written by

Dan McGarry

http://www.imagicity.com

Dan McGarry is chief technologist at the Pacific Insititute of Public Policy. He has worked in the Pacific for over a decade now, assisting in numerous capacities in the development of ICTs in Vanuatu and the Pacific. He has extensive experience in technology policy formulation and implementation as well as in traditional and new media. He still writes software.

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