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NZ aid to assist private sector

Tuesday 22 December 2020 | Written by Supplied | Published in Economy, National

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NZ aid to assist private sector
General Manager Liana Scott of Muri Beach Club Hotel says a New Zealand government financial aid program will assist Cook Islands and other Pacific countries in keeping their businesses operating during the ongoing Covid-19 pandemic. Photo: SUPPLIED. 20122108

Cook Islands businesses are set to tap into $6.9 million in New Zealand government aid that aims to support the recovery of the private sector in the Pacific Islands after Covid-19 pandemic.

In partnership with the New Zealand Ministry of Foreign Affairs and Trade, the Business Link Pacific has launched a new Finance Facility Service for small and medium sized enterprises (SMEs).

Business Link Pacific’s recent survey on access to SME finance and the impact of Covid-19 has shown a deeply impacted sector in the region.

More than 90 per cent of SMEs across the Pacific Islands that participated in the survey have reported a decline in revenue, with just under half reporting closure or expected permanent closure in the future due to the pandemic.

The new finance facility will be available initially in Tonga, Samoa, Kiribati, the Cook Islands, the Solomon Islands, Papua New Guinea and Fiji.

Eligible businesses will be able to use the facility to access capital for stabilisation, recovery and growth.

Initially, the facility will offer adaptation grants, concessionary lending and curated information on available SME financial services.

Adaptation grants applications are open now until  the end of January 2021 via https://finance.businesslinkpacific.com/adaptationgrants.

Concessional loans, which are loans at favourable interest rates, for SMEs will be available in the first quarter of 2021, through selected local financial institutions.

In addition to responding to the current crises, the facility will contribute to New Zealand’s long-term strategy to achieve a stable and prosperous region in partnership with Pacific neighbouring countries and under the framework provided by the Pacific Agreement on Closer Economic Relations Plus (PACER Plus).

Pacific Island countries face unique and historical challenges in participating in international trade. 

PACER Plus intends to help overcome these challenges by making it easier for countries to trade through a private sector that is more resilient to external threats, such as COVID-19, and is able to create jobs and increase living standards and wealth for families.

“We know SMEs have long-standing problems in accessing financial services due to both demand and supply-side factors, overlain by significant gender-related issues,” says Steve Knapp, Director of Business Link Pacific.

“These problems have become more acute since the onset of the COVID-19 crisis and it is our hope that by launching this new service we will be able to break down some of those barriers by supporting businesses to rebuild better with the right finance and business advice.”

“This new service will provide adaptation grants combined with concessional loans delivered in partnership with regional and local financial institutions.”

“They will also be supported by our network of Business Advisory Services Providers and in-Country Network Representatives,” added Knapp.

Business Link Pacific hopes this new service will allow more SMEs to access in-country business advisory services in key areas such as financial management, information technology, continuity planning and e-commerce in order to bounce back from the pandemic.

Since Business Link Pacific was established in 2017, it has assisted over 2,500 small-medium sized businesses with online Business Health Checks, Continuity Plans and in-depth diagnostics.

It has also facilitated 765 business advisory services subsidies, and contributed to the creation of an estimated 890 new jobs; 49 per cent which are filled by women.

BLP invites SMEs in Tonga, Samoa, Kiribati, Cook Islands, the Solomon Islands, Papua New Guinea and Fiji to visit  https://finance.businesslinkpacific.com and find more information about the BLP adaptation grants, including eligibility criteria for SMEs and projects. 

Applications are open now until the end of January 2021.

Information about new finance services will be released during the first quarter of 2021.