24 Feb 2005

Financial company Goldman Sachs to oversee Marshalls trust fund

2:11 pm on 24 February 2005

Financial giant Goldman Sachs has been selected to oversee investment of a multi-million dollar trust fund for the Marshall Islands.

Wachovia Bank will be the trustee bank.

The Marshalls foreign minister, Gerald Zackios, says hiring of the two US-based financial institutions is the first step to getting the allocated 40 million US dollars fully invested.

The trust fund was established two years ago by a Compact of Free Association with the US, part of a plan to wean the Marshalls off long-term grant funding from Washington.

Currently Washington provides about 60 percent of the Marshall Islands' annual budget of 115 million dollars.

The projection of the trust fund is, with a minimum earning of six percent a year, to generate the income needed to replace US grant funding in 2023 when the Compact ends.

Mr Zackios says whether the Marshall Islands gets this level of return depends on the actual investments.

He says they need a bigger return just to make up for lost time.