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FSM Development Bank Releases IDF Project Status Report

PALIKIR, Pohnpei (FSM Information Service): February 20, 1997 - The FSM Development Bank, responsible for the management of the FSM's share of the Investment Development Funds (IDF) on March 31, 1996 reported the status of the loans made to various public and private borrowers for economic development projects.

Yap Fresh Tuna, Inc. (YFTI), borrowed a total of $3,193,446 between May 22, 1991 and September 24, 1993, for a cold storage facility, construction of which took 18 months completed in July 1994 and operations began in August of the same year. Soon after, operations were interrupted due to mechanical problems including electrical at the facility and although it was later corrected, no income was reported due to unfavorable fishing season, the report stated.

At the outset, the YFTI cold storage facility was leased to Ting Hong, which later was modified to allow other fishing vessels to utilize the facility. During the 12 months ending September 30, 1995, the company reported sales of $1,932,000 and a net profit of $190,000. As of March 1996, continued the report, over 54 fishing vessels were serviced by YFTI which made some undisclosed amounts of profit. However, the grace period for the loan will be expiring at which interests will begin accruing of the unpaid loan balance.

The anticipation of economic benefits to be gained by the State of Yap for investing over $3 million in the YFTI cold storage and the projected broadening of the state's and the FSM tax base by increased fish export and over 20 full-time and 22 part-time jobs, and repayment of the principal amount for more loans was and still is the hope of the FSM Development Bank and the State of Yap.