Kiribati

Key trends and development challenges

Kiribati is an atoll state located in the Pacific sub-region of Micronesia. With a GDP of $343 million, Kiribati is one of the smaller economies in the Pacific, accounting for 0.8% of regional GDP. Kiribati has a population of 133,527, resulting in a GDP per capita of $2,569 — the second-lowest in the Pacific. Despite its small economy, the country’s exclusive economic zone (EEZ) covers 3.44 million square kilometres, the 12th-largest globally, and comparable to the EEZ of Mexico.

Kiribati has the sixth-largest official development assistance (ODA) to GDP ratio in the Pacific, with aid accounting for 45% of GDP. In a global context, Kiribati remains among the most aid-reliant countries in the world, with its aid as a share of GDP ranking eighth among 125 developing countries.

Kiribati’s population is highly dispersed over the country’s 32 remote atolls and single raised coral island. Common to many Pacific Island states, the country’s distant and dispersed population significantly increases the per capita cost of service delivery. The Kiribati government is highly dependent on fisheries income, with tuna licensing and access fees accounting for around 70% of fiscal revenue between 2018 and 2023. The Kiribati government’s development agenda is focused on improvements to education and health outcomes for its citizens, as well as the climate-proofing of public infrastructure. The Ministry of Education received the largest allocation in the most recent national budget, reflecting the prioritisation of human capital. At 0.644, Kiribati’s Human Development Index score ranks 140th out of 193 ranked countries.

Between 2008 and 2024, annual official development finance (ODF) disbursements to Kiribati — including grants, loans, and other forms of assistance — averaged $94 million. Even when adjusting for inflation, Kiribati has seen a substantial rise in total development flows over the past 17 years. In 2024, the Pacific Islands state received $111 million in development assistance — nearly three times the level of disbursements seen in 2008. Only 2.2% of the development finance received by Kiribati between 2008 and 2024 came in the form of loans.

Development partners and sector trends

Between 2008 and 2024, the vast majority of ODF support to Kiribati came from six development partners, led by Australia (31%), New Zealand (16%), Japan (11%), the World Bank (9%), Taiwan (8%), and China (7%). Since switching recognition from Taiwan to China in 2019, Chinese ODF has become a significant source of external support, financing a range of projects from roads and commercial aircraft for the national airline, to agricultural and budget support initiatives.

The largest recent ODF project in Kiribati was the East Micronesia Cable project, a multi-donor initiative including assistance from Australia, Japan, and the United States, that aims to improve internet connectivity through a new submarine cable. Australia also focused its support on the health and education sectors.

ODF disbursements to Kiribati are distinct from regional trends in terms of sector distribution. Projects focused on transport made up 22% of incoming flows, well above the regional average of 13%. Infrastructure has been a major and increasing focus of ODF flows to Kiribati, with the sector seeing considerable external support over the past decade. While the pandemic briefly interrupted this trend in 2020, infrastructure spending bounced back in 2023.

Over the past 17 years, Kiribati has received $79 million in development financing with a “principal” focus on either climate adaptation or mitigation. In the same period, the country has seen $362 million in development financing with a “significant” focus on climate outcomes. Since the late 2010s, Kiribati has seen steady growth in climate-targeting projects, a trend mirrored across most of the Pacific. As a share of total ODF received by Kiribati, “principal” climate projects made up 5% of total spending, below the regional average of 8%. Conversely, spending on “significant” climate projects in Kiribati made up 23% of incoming funds, above the regional average of 17%. To date, the largest ODF climate investment in Kiribati has been the Kiribati Adaptation Project, financed by the Australian government and the World Bank.

Between 2008 and 2024, Kiribati received $85 million in development financing with a “principal” focus on gender equality, and $414 million in development financing with a “significant” focus on gender equality. “Principal” gender equality financing constituted 5% of ODF received by the country, above the regional average of 2%. Similarly, “significant” marked gender financing made up 26% of incoming ODF, also above the regional average of 23%. The largest project tagged as directly targeting gender equality in Kiribati was the multi-year $16 million Kiribati Australia Nurses Initiative, funded by Australia.