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Parliament has approved a government guarantee for the Fiji Development Bank’s borrowings for a 12-month period.

Deputy Prime Minister and Minister for Finance Professor Biman Prasad moved the motion, seeking parliamentary approval for the government to guarantee the FDB’s borrowings from the first of this month to 28 February 2026.

The guarantee covers up to $190 million through various financial instruments, including bonds, promissory notes, term deposits, and Reserve Bank of Fiji financing facilities.

The motion also stipulates that the bank will pay a guarantee fee of 0.075 percent on the cumulative utilised guarantee credit.

In his address to Parliament, Professor Prasad highlighted FDB’s critical role in supporting economic growth, particularly in the agriculture and resource-based sectors, micro, small, and medium enterprises, and sustainable energy initiatives.

He highlighted that the government guarantee will enhance investor confidence, lower borrowing costs, and allow the bank to extend further support to businesses and individuals seeking financial assistance.

“I say the 2025 Government guarantee request from the Bank is to continue facilitation of Government policy by lending to essential sec-tors of the economy, particularly resource-based sectors including agriculture, mining, quarrying, manufacturing, transport, communica-tions, micro, small, medium enterprises, wholesale, retail, and hotels, sustainable energy from fossil fuels to renewable sources, and pro-fessional and business services which will assist the disadvantaged of the community to earn a decent living.”

Professor Prasad stated that the bank has never defaulted on its government guaranteed borrowings in previous years, demonstrating its strong financial management.

He also assured Parliament that the government will continue working closely with the FDB to align its services with the National Development Plan and Sustainable Development Goals.

He adds that with the passage of the motion, FDB will have greater flexibility to negotiate borrowing terms, ensuring continued financial support for key economic sectors.

The Finance Minister says the approval brings the total government guarantee exposure to $1.2 billion, equivalent to 8.2 percent of GDP.

The motion faced no opposition and was unanimously supported by Parliament.

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