19 Dec 2013

Tonga's Akilisi Pohiva ponders China's price for loan to grant deal

3:08 pm on 19 December 2013

The leader of the Tonga opposition, Akilisi Pohiva, says the country risks being put in a very difficult position as it tries to get China to turn a huge loan into a grant.

China gave Tonga a loan of more than 60 million US dollars for the rebuild of Nuku'alofa after riots in 2006.

Repayments on the loan were due to commence in September this year but China has agreed to an indefinite delay.

In the meantime the Tonga government has made several trips to Beijing to plea for the loan to become a grant.

Mr Pohiva says the country will not be able to repay the debt but if it is to become a grant China will expect something from Tonga.

"We are now in a very difficult position to make any choice because failure to pay the loan would give China a chance to make a choice. Whatever China will need Tonga to do - that's what will happen."

Akilisi Pohiva suggests China could ask Tonga to allow it to establish a naval base in the Kingdom.