Fiji’s access to a US$12.5 million World Bank-backed forest carbon financing programme is set to come to an end after the Government decided to terminate the project amid mounting delays, governance concerns and unmet obligations.
According to publicly released World Bank implementation support mission in February 2026, Fiji made limited progress in meeting critical legal, financial and safeguard requirements under the Forest Carbon Partnership Facility (FCPF) Carbon Fund Emission Reductions Program (ERP).
The report reveals that Fiji had not received any disbursements under the programme despite the funding arrangement being approved in 2020 and becoming effective in 2021.
The World Bank granted Fiji a six-month extension until June 30, 2026 to allow the Government time to establish systems needed to distribute carbon payments to beneficiaries, including landowning units, communities and smallholder farmers. However, the Bank found progress had been insufficient.
Among the outstanding requirements were a revised Benefit-Sharing Plan, safeguards monitoring reports, final monitoring documentation and legal arrangements governing the transfer of emissions reduction rights.
The Bank noted that Fiji remained in default of several obligations under the Emission Reductions Payment Agreement (ERPA) and assessed that it would be unrealistic for the country to meet conditions required for a further extension.
“The ERP risk rating was elevated to High in November 2025 due to the tight timeframe to complete pending actions, fiduciary and governance concerns given key financial management actions remain outstanding, and continued delays in meeting agreed environmental and social requirements,” the report stated.
The Ministry of Finance subsequently informed the World Bank that it intended to request cancellation of the programme and suspend further activities, including stakeholder consultations on the Benefit-Sharing Plan.
Following the mission, the ministry formally notified the Bank on February 27 that it wished to conclude the project immediately.
The World Bank has since moved to bring forward the termination of the agreement through amendments to the existing legal arrangements.
“Upon termination of the ERPAs, Fiji’s access to FCPF financing and ERP support end,” the report stated.
Despite the termination, the Bank noted that work undertaken under the programme remains relevant to Fiji’s future participation in international carbon markets.
The report said the Government continues to develop regulations, benefit-sharing arrangements and systems needed for future REDD+ and carbon trading initiatives.
The World Bank also acknowledged progress made by the Office of the Solicitor-General in establishing a legal pathway for Fiji to transfer emissions reduction rights generated from public and non-public lands, describing the work as an important foundation for future carbon finance opportunities.
