Kiribati : Otintaai Hotel (English)

The Republic of Kiribati, an island nation located between Hawaii and Fiji in the Pacific Ocean, has long depended on the public sector and foreign aid. Its government will like to change this by reforming state-owned enterprises, developing its infrastructure...  See More + The Republic of Kiribati, an island nation located between Hawaii and Fiji in the Pacific Ocean, has long depended on the public sector and foreign aid. Its government will like to change this by reforming state-owned enterprises, developing its infrastructure, and laying the foundation for growth in the private sector. As a part of this reform effort, the government turned to International Finance Corporation (IFC) to find a private sector partner to rehabilitate and operate the state-owned Otintaai hotel, which had long been a drain on the state budget. As one of Kiribati’s few hotels, the project is critical to expanding the provision of suitable accommodation to visitors. Royal Crown Enterprises Limited, a local firm, won the tender in Kiribati’s first public-private partnerships (PPP) in the tourism sector. Under the 25-year concession, Royal Crown will renovate and manage the 40-room hotel, providing accommodations meeting the equivalent of a three-star rating by Australia’s official accommodation accreditation system. It is estimated that 2.25 million dollars in private sector investment will be mobilized in the first two years. The concession was granted in September 2013. Under the new model, when the hotel is fully operational, the government will realize fiscal benefits in the form of taxes and concession fees that can total up to $100,000 per annum.  See Less -