Leaders to sign Pacific's first legal finance body

Pacific leaders will sign the Pacific Resilience Facility (PRF) treaty this week, making it the region’s first legal financial institution.

Leaders are meeting in Honiara, Solomon Islands for the 54th Pacific Islands Forum Leaders Meeting (PIFLM), where regional issues top the agenda.

Once signed, the PRF becomes a Pacific-managed regional climate and disaster facility - a financing institution dedicated to Pacific communities.

PRF regional manager Finau Soqo said nine investors had pledged US$159 million (FJ$358m).

Pacific leaders have set a target of US$500m (FJ$1126m), before pushing for a $1.5 billion target.

“What we really want to do is make sure that we fundraise the whole $500m before we start granting to communities so that the fund can be sustainable,” Ms Soqo said.

“A huge factor, or certainly an enabling factor for us to be able to reach the remaining US$341 million (FJ$151m) by the end of 2026 is if we will be able to host COP31 in Australia.

“From there, the leaders have basically articulated their vision that they will then launch to a 1.5 billion for 1.5-degree world.”

Ms Soqo said 13 leaders were expected to sign the treaty on Wednesday.

“This is essentially a demonstration of the seriousness of the region and the commitment from our leaders; how important it is for our people and of course our partner’s support,” she said.

Implementing agencies

The two main implementation modalities will be through partners and Government.

“For partners, the categories that we’re looking at are international, regional, sub-regional, national, sub-national and community-based organisations,” Ms Soqo said.

“The choice of partners will determine whether we’re successful in implementation or not.”

Facility structure

Ms Soqo said there was a climate and disaster resilience pillar and a social and community resilience pillar.

“Under the climate and disaster, we can give grants for climate adaptation, disaster preparedness, disaster response, nature-based solutions and loss and damage,” he said.

“There are four funds in the PRF. One is the investment fund that will essentially invest the grant capital.

"Then there’s the operations and disbursement fund which is where the community grants will come and dispersed to countries and then goes on to communities.

“At the moment, there are two contingency funds. One is a disaster response fund, second is a contingency fund. The disaster response fund is for disasters.”

Next step

Ms Soqo said once the PRF treaty was signed, the PRF Council would then convene.

The PRF council currently consists of Ministers of Finance from Pacific Islands Forum member states.

Documentation work will then be carried out, outlining the rules of procedure, the standard operating procedures and the policy framework.

The PRF will be operational in 2026 at the 55th PIFLM in Palau, where leaders must be ready to call for grants.

“Money must go out the door to communities by 2027. So, there’s a three-year pilot limit – 2027, 2028, and 2029.”

Tonga will host the PRF.