Koror, Palau – Palau is seeking a $15 million loan from Saudi Arabia’s Public Investment Fund, according to a proposed resolution submitted by President Surangel Whipps Jr. to the country’s legislature, Olbiil Era Kelulau. The resolution, if approved, would authorize the president to finalize the loan agreement.
The loan would be sub-loaned to Palau’s National Development Bank of Palau (NDBP) to fund infrastructure development projects.
In his transmittal letter, President Whipps stated, “The agreement will provide low-cost capital to significantly support NDBP’s efforts to offer residential mortgages to Palauan citizens and to support NDBP’s initiatives to develop Palau’s agriculture, aquaculture, and tourism sectors.”
The terms of the proposed loan include a 2.5% annual interest rate. However, the agreement also stipulates that the loan be denominated in Saudi Riyals, the Saudi currency, and that the loan documents remain confidential. Additionally, Saudi Fund employees traveling to Palau would be granted diplomatic immunity, and all transactions would be exempt from taxes.