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Loans and grants

Loans and grants

Sustainable lending

We enable infrastructure that is transparent, responsible and upholds robust standards so that investments deliver long-term benefits, meets the genuine needs of our Pacific and Timor-Leste partners, and avoids unsustainable debt burdens.

Flexible financing tailored to specific needs

The AIFFP provides both loans and grants to finance infrastructure projects that contribute to the overall stability and economic prosperity of the Pacific and Timor-Leste.

The provision of grants enables the AIFFP’s financing to be more concessional and attractive to its sovereign borrowers, as well as ensure the AIFFP can operate in countries where loans are not suitable due to debt concerns.

In providing sovereign loans, the AIFFP, at a minimum, ensures its financing is consistent with Australia’s international obligations on debt sustainability and tailored to reflect a country’s specific debt circumstances. Each loan investment will be priced on a loan-by-loan basis.

Interest rates

The loans provided by the AIFFP carry an interest rate broadly in line with or comparable to multilateral development bank rates (e.g. World Bank International Bank for Reconstruction and Development) for sovereign borrowing and benchmarked to market rates for private sector borrowing. Each loan investment will be priced on a loan-by-loan basis.

Risk management

Learn about how we assess the risk factor of proposals.