Tonga's Government offers development loans to assist businesses Featured
5 April, 2022. Tonga's Government has announced a financial recovery package of $US9.78 million to help revive the country's economy.
More than half of the package is in the form of government development loans totalling $US5 million.
Businesses in the agriculture, fisheries, and tourism sectors have been offered up $US22,230 per annum whilst retail and wholesalers have been offered up to $US88,900 per annum.
Tonga Chamber of Commerce President Sam Vea said that many businesses wanted stronger assistance from the government such as a cash injection, subsidies on bank loans, as well as a reduction in utility costs.
He said that businesses are struggling and many are unable to repay debts because their revenue relies on foreign tourists arrivals, which have been virtually non-existent since Tonga enforced a border closure in March 2020.
The kingdom is currently experiencing an economic downturn with the government relying almost entirely on financial aid from foreign governments and agencies.
Tourism has been virtually non-existent since March 2020, after a border closure was enforced by the government to prevent a Covid outbreak.
A devastating volcanic eruption on January 15 followed by a Covid-19 outbreak a few weeks later, added to the kingdom's economic woes.
Many resorts were destroyed by tsunami waves in January's Hunga Tonga-Hunga Ha'apai volcanic eruption, and a strict nationwide Covid-19 lockdown has seen a drop in revenue across all sectors.
