2 May 2006

The Marshall Islands lobbys ADB to forgive two loans

11:23 am on 2 May 2006

The Marshall Islands is lobbying the Asian Development Bank to forgive at least two early-1990s loans that government officials say were flawed and brought the country no benefits.

Since the Marshall Islands joined ADB in 1990, it has borrowed nearly 80 million US dollars.

The current repayments are now only at 1 million US dollars a year, but an ADB official, Stephen Pollard, says they are delinquent on loan payments.

Marshall Islands officials says they hope to put their case for a reduction in loan payments at the annual ADB meeting in Hyderabad in India next week.

Mr Pollard says the Marshalls has missed loan payment deadlines twice in the last several months and the bank considers the Marshall Islands to be delinquent.

He says ADB is reviewing the situation, with a decision expected shortly about halting loan and technical assistance projects in the Marshall Islands.

The Marshalls Finance Secretary Jefferson Barton says his government is attempting to engage the ADB in negotiations over what he and others say are earlier "non-performing" loans that account for a large percentage of the debt with the bank.