“Australia has emerged as a major lender to the Pacific. Budget support operations in PNG and a growing pipeline of projects funded through the Australian Infrastructure Financing Facility for the Pacific (AIFFP) have made it the region’s largest source of new lending since 2021, with $2.4 billion in new loan agreements signed over the period.”
“By contrast, China’s role as a regional lender has declined significantly. From 2010 to 2019, China signed around $3.6 billion in loans to Pacific countries, accounting for more than one-third of all lending deals in the region and making it the region’s largest lender by total deal size. This translated into an average of $228 million in annual disbursements over the decade. However, since 2020, China has committed just $390 million in new loan deals, with average annual disbursements of $91 million, less than half previous levels.”
“Excluding budget support, lending to the Pacific by all development partners has been concentrated on infrastructure, particularly strategic infrastructure. Defined broadly as including investments in ports, airports, telecommunications networks, and power generation assets, strategic infrastructure has been the fastest-growing area of Pacific development finance over the past decade…”