THE Asian Development Bank has approved USD$40.1 million to help Kiribati, Tonga and Tuvalu manage rising fuel costs linked to the conflict in the Middle East.

Under the Pacific Regional Energy Security Emergency Assistance Project, Kiribati will receive USD$12.77 million, Tonga USD$15.39 million and Tuvalu USD$11.94 million.

The funding will help maintain affordable electricity services, support essential services and ease the impact of higher fuel and living costs on vulnerable households.

In Tuvalu, the project will provide targeted assistance to about 6,000 people from low-income households. In Tonga, it will support Tonga Power Limited to maintain affordable electricity services.

The three countries rely heavily on imported fuel and face high transport costs because of their geographic isolation. Rising global fuel and freight prices have increased the cost of electricity generation and essential goods.

ADB President Masato Kanda said Pacific Island economies had limited capacity to absorb sudden increases in imported energy costs, with the effects extending to electricity, essential services, household budgets and food prices.

The economic impact of higher fuel prices and related disruptions to energy security across the three countries is estimated at more than USD$80 million.

The project aims to provide temporary support to protect vulnerable households, maintain essential services and strengthen energy security.