Tonga

PSDI is supporting reforms that address private-sector challenges and help the Tongan economy fulfill its long-term growth potential.

PSDI is working with the Government of Tonga to: 

  • Increase access to finance through the implementation of a secured transactions framework, and providing assistance to lenders to enhance the framework’s uptake;

  • Strengthen the governance and operations of Tonga’s public and private-sector retirement funds;

  • Simplify and modernize business and investment laws, and streamline business registration processes through electronic registry implementation;

  • Improve the performance of state-owned enterprises through reform, PPPs, and transparent performance information;

  • Assess public-private partnership and privatization opportunities;

  • Support strong competition and consumer protection legislation and policy development;

  • Analyse and work to remove constraints to women’s full economic participation, through Women’s Business Leadership pilot projects and incorporating a gender perspective into reform activities; and

  • Support reforms through advocacy and analytical work.

Resources and Spending

Since 2007, Tonga has received $4.7 million in PSDI assistance. 28% of this overall figure has been allocated to business law reform initiatives, which have included development of the Pacific’s first multiple-entity registry and numerous legislative reforms. A broad state-owned enterprise (SOE) reform and public-private partnerships program has also received 28% of total funding. Financing Growth initiatives have received 20% of the overall figure, including the development of a secured transactions framework and associated work to increase the provision of loans secured against movable assets. 

Tonga2007 2019 web2

On this website, $ refers to US dollars unless otherwise stated.

For detailed information on PSDI activities in Tonga, download the 2022 PSDI Country Overview here.

Tonga at a glance

Simplified and modernized business laws

PSDI assisted the Government of Tonga in preparing the Companies (Amendment) Act, which streamlines the Companies Act 1995 and provides for an electronic registry.

80% faster business registrations

Following the implementation of an online business registry, the average time needed to register a business fell from 5 days, to just 1 day.

29% increase in new business registrations

per year, following the implementation of an electronic registry in 2014.

Secured transactions framework

PSDI supported the creation of Tonga’s secured transactions framework with the Personal Property Securities Bill in 2010, and online registry development in 2011.

9,500 securities registered

As of end-2019, more than 9,500 security interests over movable assets to be used as collateral for loans have been registered in Tonga using the PSDI-supported secured transactions framework.

South Pacific's largest solar plant

being built on Tongatapu using commercial finance through a PSDI-supported PPP.
Latest News
25 October 2023
PSDI presents Gender Inclusive Private Sector Enabling Environment Framework assessment in Tonga

A large group of representatives, including government, business owners, and development partners gathered in Nuku’alofa, Tonga last week for the Tonga National Business Conference where PSDI presented the gender-inclusive private sector enabling environment framework assessment for Tonga.

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16 March 2023
Tonga's SOE framework among Pacific's best, but reforms should continue—ADB PSDI report

Tonga has one of the strongest SOE governance and monitoring frameworks in the Pacific, but its government should continue to seek out new commercialization opportunities, a new ADB PSDI report says.

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8 March 2023
PSDI supports Pacific digital gender gap study in PNG, Samoa, and Tonga

As International Women's Day 2023 shines a light on the digital gender gap and technological inclusion, watch this video to find out more about PSDI’s support for a digital gender gap audit of Papua New Guinea, Samoa, and Tonga.

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14 December 2022
Tonga to use PSDI-supported Crises Impacts Assessment to guide tourism recovery, resilience

PSDI has supported Tonga’s Ministry of Tourism to assess the impact of Tropical Cyclone Harold, the Hunga Tonga-Hunga Ha’apai volcanic eruption and tsunami, and COVID-19 on the country’s tourism sector.

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24 August 2022
Tonga solar farm online after PSDI's PPP assistance

The final tranche of a PSDI-supported solar farm in Tonga has come online—the largest project of its kind in the South Pacific.

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1 June 2022
Access to Finance, Business Registration Awareness Key for Tongan Informal Sector Assistance

A new, PSDI-supported informal business survey in Tonga will help inform government programs and business services for the country's informal sector, Economic Empowerment of Women Expert Sarah Boxall says.

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Key Publications
Innovative Financing Mechanisms in the Pacific
Innovative Financing Mechanisms in the Pacific
This paper examines the potential benefits and issues to consider around implementing Innovative Financing Mechanisms in the Pacific, which can lower barriers and provide more options for businesses seeking finance.
Investment For Growth: A review of foreign direct investment frameworks in the Pacific
Investment For Growth: A review of foreign direct investment...
This study reviews the FDI frameworks in Papua New Guinea, Samoa, Solomon Islands, Tonga, and Vanuatu, to support countries to attract, retain, and assess FDI efficiently and effectively.
Invisible Hands: Enabling Pacific Women in the Informal Economy
Invisible Hands: Enabling Pacific Women in the Informal Econ...
This publication is the first in a series of PSDI reports focused on the role of women in the Pacific region’s informal economy.
PSDI Annual Report FY2022
PSDI Annual Report FY2022
This report gives an overview of PSDI activities from July 2021 to June 2022.
PSDI Tourism Infographic Brochure
PSDI Tourism Infographic Brochure
This infographic brochure illustrates PSDI’s work and key achievements in the Pacific tourism sector.
Finding Balance 2023: Benchmarking Performance and Building Climate Resilience in Pacific State-Owned Enterprises
Finding Balance 2023: Benchmarking Performance and Building ...
This report reviews the performance of SOEs in nine Pacific island economies and looks at how policymakers can help state-owned power utilities address climate risk.