Government of the Federated States of Micronesia

Chuuk Met ADB Water and Sanitation Loan Conditions

PALIKIR, Pohnpei (FSM Information Service): November 28,
1997 – President Jacob Nena, on November 19, 1997, informed Chuuk
Governor Ansito Walter that his state has complied with all ADB loan
preconditions and that withdrawal of loan proceeds for Project
Implementation in Chuuk State may commence.

The conditions of disbursement for the Chuuk Water Supply and
Sanitation Project include an official confirmation by state’s that
Chuuk Public Utilities Cooperation (CPUC) Board of Directors has the
ability to set tariff for water supply and sewerage services, without
the prior approval of the State Government and that CPUC has the
right to retain its revenues. The Chuuk Attorney General has
confirmed to ADB of the state’s legal opinion on the ADB’s concerns.

Nena told Walter that the FSM Office of Planning and Statistics,
the executing agency, has informed him that a contract for supply of
drilling rig and necessary ancillary equipment has been awarded. The
project will involve drilling of thirty waterwells on Weno Island in
Chuuk State where more than 16,000 people lived.

In its final report on the project T.A. No. 2137-FSM, Stanley
International Group Inc., a Canadian company says that domestic and
foreign fishing fleets and tourist industry are concentrated in the
state centers. It is hoped that with improved water and sewerage
systems and expanded commercial activities will provide the foreign
currency the FSM requires to offset the diminishing infusion of
capital currently provided by Compact funding.