In October 2022, the Australian Infrastructure Financing Facility for the Pacific (AIFFP) partnered with the Republic of Fiji to provide a AUD72 million concessional, results-based financing package, which includes a grant of AUD14.7 million for the Fiji Transport Infrastructure Restoration Project.
The financing package will support the renewal or resealing of more than 1.5 million square metres of road surface throughout Fiji, as well as replacement of nine bridges that are crucial to the Fijian economy. Importantly, the financing package includes a three-year grace period during which repayments will not be required.
The Fiji Roads Authority (FRA) is responsible for Fiji’s network of roads, bridges and jetties. The upgrade, renewal and maintenance of FRA’s asset base represents a critical component of maintaining and growing economic activity in Fiji.
Given its reliance on tourism, Fiji has been one of the worst affected countries during the COVID-19 pandemic and its economy has been severely impacted, with real GDP contracting by approximately 21.3 per cent between 2019-2021.
In addition to major economic disruption as a result of the COVID-19 pandemic, Fiji has also experienced three cyclones in the past two years, which have caused hundreds of millions worth of damage to infrastructure and livelihoods.
As part of this investment, nine bridges across Viti Levu are receiving climate resilient upgrades, including Bulu Bridge, Korovou Bridge, Matewale Crossing, Tavualevu Bridge, Velovelo Bridge, Vuniyasi Bridge, Waidalice Bridge, Wainawi Bridge and Yaqara Bridge.
|Variable interest rate||Tenor|
|Loan||$57.1||$40.0||SOFR + 0.93%||15 years (3 year grace period)|
*Exchange rate: AUD/0.70USD, exact AUD amount depends on exchange rate at disbursement. SOFR is the Secured Overnight Financing Rate.
Fiji Roads Authority
Republic of Fiji
As Fiji faces the significant impacts of climate change, there is a critical need to ensure that its infrastructure is climate resilient to minimise potential disruptions. The rehabilitation and maintenance of the Fiji road network is vital to improve safety and protect against increased travel time and costs, as well as potential disconnection of communities due to bridge failures.
This investment will support the renewal or resealing of more than 1.5 million square metres of road surface throughout Fiji, as well as replacement of nine critical bridges to ensure that the road network remains connected, promoting economic activity and access to socioeconomic opportunities for local communities.
Climate data is integrated into all the bridge designs, helping to improve resilience to shocks and stresses. As a result, the bridges will have up to a 100-year design life, with the ability to withstand a one in 100-year rainfall event.
With its economy having been severely affected by the COVID-19 pandemic, the concessional financing package will provide the Republic of Fiji with increased flexibility to maximise its budget outcomes.
Road maintenance investments generate strong economic rates of return. Improved road infrastructure results in lower costs of transport and reduced travel times, which leads to lower costs for businesses, increased economic inflows, and greater access to markets.
Road maintenance is labour intensive and can be highly effective in encouraging local employment opportunities. AIFFP investments prioritise local workforce engagement, and all road renewal contractors are locally registered and employ a majority of local Fijian workers.