National Financing Strategy

1. FinalProject–3.GovernmentOfficial:
National Financing
Strategy
Republic of the Marshall Islands (RMI)

2. 1. RMI’s
Development
Priorities
The RMI’s development priorities are highlighted in the following 3
key development documents:
Vision 2018 – Highlights the country’s long-term vision;
RMI National Strategic Plan – States the medium-term
development strategy and plan;
Agenda 2020 – Outlines the action plans.
2

3. 1. RMI’s
Development
Priorities -
Cont.
Overarching Vision 2018 identifies 10 development themes for
the country:
1. Good governance 6. International cooperation
2. Reduction in access related
poverty
7. Inclusive growth
3. Strengthening ability to
mobilize local and traditional
knowledge
8. Sound infrastructure
4. Building up a caring society 9. Climate change
5. Innovative people 10. Outer island development
3

4. 2. Estimated
Financing
Needs for
RMI’s
Development
RMI’s GDP was valued at US$212m in 2018
(countryeconomy.com).
According to the UN’s FSDR 2019, the investment gap for low
income countries such as the RMI is around 16% of its GDP per
year in order to reach the SDGs by 2030.
Therefore, RMI’s investment/financing needs to complement and
supplement the country’s existing financing arrangements and
sources is estimated to be around US$34m per year, or a total of
US$374m in the next 11 years to reach the SDGs by 2030.
4

5. 3.Sources of
Finance for
RMI’s
Development
According to the RMI draft Development Finance
Assessment report the finance sources to address the
country’s financing needs are:
1. Public domestic sources
Tax revenue;
Non-tax revenue.
2. Public development assistance:
U.S Compact Grants and other federal grants;
ODA from non-US DAC countries;
Sectoral distribution and delivery channel of ODA;
South–South Cooperation;
Vertical funds and climate financing.
5

6. 3.Sources of
Finance for
RMI’s
Development
–Cont.
According to the RMI draft Development Finance
Assessment report the finance sources to address the
country’s financing needs are:
3. Public sector external borrowing
Debt creating financial flows.
4. Private sources – domestic and foreign:
Gross domestic savings;
Remittances;
Foreign Direct Investment;
International Private Development Assistance.
6

7. 4.Access to
theSources of
Finance
The current sources of finances should be further explored to allow
the RMI to address its financing gaps.This can be facilitated through:
Tax and revenue policies and practices reform to address collection
inefficiencies and deficiencies;
Non-tax revenue policies to be put in place to better utilize non-tax
revenues;
U.S compact funding implementation and monitoring to be improved to
allow access to further compact funding arrangements;
Other forms of development assistance to be explored and utilized
through the formulation of an international development assistance
policy and the accreditation of the RMI Ministry of Finance;
Foreign direct investment and trade promotion by providing an
enabling environment and streamlined processes for foreign direct
investment and trade with the RMI;
Remittances policy to be put in place to encourage its utilization on
development activities;
Debt policy to be formulated to effectively guide RMI’s external debt
considerations and utilization.
7

8. 5.Addressing
Financing
Barriers
The RMI should partner with MDBs to address its financing
barriers for development through the following:
Provision of advisory and technical services to domestic public and
private sector financing providers and sources to enhance their
development financing policies, opportunities and options;
Creation of innovative financing vehicles and instruments including
risk mitigating instruments that entices international investors and
financiers to provide financing;
Provide appropriate capacity buildings to development finance
planners and policy makers to ensure funding is sourced, managed
and utilized effectively and efficiently on country development
priorities;
Encourage ,structural, policy and legal reforms in the public sector
and private sector including encouraging public-private sector
partnerships to ensure stakeholder objectives are aligned and
supports the RMI national development goals and priorities.
8

9. Thank you
9