owed to China’s Exim Bank,<\/a> taken out to rebuild Nuku’alofa’s central business district after the 2006 riots.<\/p>\nThe initial loan, taken out in 2008, was for $55 million (NZ$96.6m) , but with interest, the debt reached more than $100 million (NZ$175.65m) by 2024.<\/p>\n
Tonga’s government has committed to paying down its debt by 2030, and in the year to June 2025, it paid China $17.7 million (NZ$31m) as part of total debt repayments of $29.4 million.<\/p>\n
The repayments represent a large share of government spending in the small nation where the annual infrastructure budget was just $10.1 million (NZ$17.7m).<\/p>\n
The health budget for the same year was $24.9 million (NZ$43.7m), boosted by one-off funding provided by donors, including New Zealand and Australia, to redevelop Nuku’alofa’s hospital and nursing buildings.<\/p>\n
The health budget is expected to be significantly lower this year, despite the country’s dire rates of obesity, diabetes and non-communicable diseases.<\/p>\n
“We could use that money for other things,” Lord Fakafanua told AFP when asked if the debt to China hurt Tonga’s health and infrastructure needs.<\/p>\n
“But Tonga committed to signing a loan agreement, and we intend to pay off what we signed to do.”<\/p>\n
Chinese support<\/p>\n
While Tonga shows fiscal restraint, China wants to spread its influence in the Pacific by offering loans and building infrastructure.<\/p>\n
![\"Tonga's](\"https:\/\/www.newsbeep.com\/nz\/wp-content\/uploads\/2026\/04\/4JXAR6P_AFP__20251125__863A6ZQ__v1__HighRes__ChinaTongaDiplomacyRoyals_jpg.jpeg\")
<\/p>\n
\nTonga’s King Tupou VI and China’s President Xi Jinping shake hands after a signing ceremony at the Great Hall of the People in Beijing on 25 November 2025.
\nPhoto: AFP \/ Pool \/ Maxim Shemetov\n<\/p>\n
During a November visit to Beijing by Tongan King Tupou VI, President Xi Jinping said China was ready to “provide assistance to Tonga’s economic and social development” and said he wanted Tonga’s “independence and sovereignty” to be safeguarded.<\/p>\n
Lord Fakafanua said his country will not be accepting any more Chinese loans.<\/p>\n
“We’re currently in a position where we’re not taking any more loans, we’re not taking any more debt,” Lord Fakafanua told AFP.<\/p>\n
“We’re being a lot more clever with our fiscal management,” he added.<\/p>\n
According to Tonga’s budget documents, the country faces significant risk from its loan to China, with “refinancing risk and exchange rate risk being the primary concerns”.<\/p>\n
The International Monetary Fund says Tonga is at high risk of debt distress.<\/p>\n
World Bank grants<\/p>\n
Tonga has received several grants from the World Bank and the Asian Development Bank to build much-needed infrastructure.<\/p>\n
That includes the $97 million (NZ$170.4m) Fanga’uta Lagoon Bridge project currently under construction — the largest infrastructure project in Tonga’s history.<\/p>\n
The 720-metre-long bridge will connect Nuku’alofa, with the southern side of the main island, Tongatapu.<\/p>\n
More than 120 Tongans are working on the project, which will provide a new evacuation path for Nuku’alofa in the event of a tsunami or flooding caused by tropical cyclones.<\/p>\n
![\"NZ](\"https:\/\/www.newsbeep.com\/nz\/wp-content\/uploads\/2026\/03\/4JRKPPY_Luxon_Tonga_2_JPG.jpeg\")
<\/p>\n
\nNZ Prime Minister Christopher Luxon at Nuku’alofa Government Middle School in Tonga.
\nPhoto: RNZ \/ Giles Dexter\n<\/p>\n
New Zealand’s Prime Minister Christopher Luxon viewed the bridge site during his two-day visit to Tonga in March,<\/a> speaking to the New Zealand firm McConnell Dowell, which is building the bridge.<\/p>\nLuxon said he supports Tonga’s focus on fiscal restraint, and it “goes without saying” that New Zealand was ready to help when needed.<\/p>\n
-AFP<\/p>\n","protected":false},"excerpt":{"rendered":"A satellite image showing the eruption of Hunga Tonga-Hunga Ha’apai on 15 January 2022. Photo: Tonga Meteorological Services…\n","protected":false},"author":2,"featured_media":364587,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[48,47,42,43,49,46,44,45,40,38,41,39],"class_list":{"0":"post-364586","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-headlines","8":"tag-audio","9":"tag-current-affairs","10":"tag-headlines","11":"tag-news","12":"tag-podcasts","13":"tag-public-radio","14":"tag-radio-new-zealand","15":"tag-rnz","16":"tag-top-news","17":"tag-top-stories","18":"tag-topnews","19":"tag-topstories"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/364586","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=364586"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/364586\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/364587"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=364586"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=364586"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=364586"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
![\"A](\"https:\/\/www.newsbeep.com\/nz\/wp-content\/uploads\/2026\/04\/4KDLAK9_skynews_tonga_volcano_tsunami_warning_5641872_jpg.jpeg\")
<\/p>\n![\"Kanokupolu](\"https:\/\/www.newsbeep.com\/nz\/wp-content\/uploads\/2026\/04\/4LF5MOF_d23878b3_effd_410b_9e4d_1d19c236ddca_jpg.jpeg\")
<\/p>\n