World Bank and ADB launch first Pacific projects under new mutual reliance framework

The new framework allows countries to work with a single lead lender, either ADB or the World Bank, responsible for guiding all aspects of project design, preparation, supervision and evaluation.

World Bank Group President Ajay Banga and Asian Development Bank (ADB) President Masato Kanda have announced the first two major development projects to be implemented under the Full Mutual Reliance Framework — an innovative cofinancing approach designed to make development finance faster, simpler, and more effective across the Pacific.

The new framework allows countries to work with a single lead lender, either ADB or the World Bank, responsible for guiding all aspects of project design, preparation, supervision and evaluation. By reducing duplication between institutions, the approach is expected to streamline procurement, speed up implementation, and lower transaction costs for governments, while maintaining high policy, fiduciary and environmental standards.

“Making Development Finance Simpler and Faster”

“Our goal is to make development finance simpler, faster, and more effective,” said ADB President Masato Kanda. “With this approach, we respond to client needs to solve complex challenges together — from disaster resilience to better connectivity — while supporting their long-term vision for prosperity.”

World Bank President Ajay Banga underscored the framework’s demand-driven nature: “We pursued this framework for one core reason: our clients asked us to make their lives easier. To work faster. To be better partners.”

The operational rollout of the framework reflects the already strong World Bank–ADB cooperation in the Pacific and directly responds to country requests for more efficient, harmonized development financing systems.

Project 1: Pacific Healthy Islands Transformation (PHIT) — Fiji

Lead institution: World Bank Total cost: $236.5 million Status: World Bank financing approved; ADB cofinancing to be considered early 2026

The PHIT project is the largest single operation ever undertaken by the World Bank Group in the Pacific. It addresses the region’s escalating burden of noncommunicable diseases (NCDs) — including cardiovascular disease, diabetes, cancer and chronic respiratory conditions, which represent some of the leading causes of death across Pacific island nations.

In Fiji, PHIT will:

• Modernize primary health-care networks

• Strengthen diagnostics and screening services

• Construct a new state-of-the-art regional hospital, which will serve patients across the Pacific

• Expand specialist services, reducing the need for medical travel abroad

• Improve workforce training, digital health systems and supply-chain resilience

The project represents a transformational investment in Pacific health systems, aiming to reduce premature deaths and improve access to essential care across vulnerable island populations.

Project 2: Tonga Sustainable Economic Corridors and Urban Resilience (SECURE)

Lead institution: Asian Development Bank Total grant financing expected: $120 million (combined ADB + World Bank) Status: Approved by ADB Board on 20 November 2025; World Bank cofinancing to be considered in early 2026

The SECURE project will become the largest development partner–financed project in Tonga’s history. It introduces transformative infrastructure upgrades to address long-standing challenges related to urban congestion, climate vulnerability and limited connectivity in Greater Nuku’alofa.

Key components include:

• Upgrading transport networks across Tonga’s capital region

• Modernizing and expanding urban drainage systems to reduce chronic flooding

• Constructing the 720-meter Fanga’uta lagoon bridge, a flagship infrastructure investment

• Improving market access for rural communities

• Enhancing connectivity to the airport, port and essential public services

• Providing rapid evacuation routes in the event of tsunamis and other disasters

The project is expected to significantly improve mobility, urban resilience and long-term economic opportunities for Tonga’s growing population.

A New Era of Pacific Development Cooperation

Together, these two flagship projects signal the beginning of a deeper, more efficient partnership between the World Bank and ADB in the Pacific. By reducing administrative burdens and harmonizing procedures, the Full Mutual Reliance Framework aims to allow governments to focus more on results — better health, stronger infrastructure and more resilient communities — and less on navigating complex financing systems.