The French government has given New Caledonia a further $US200 million loan to help it balance its budget.
The sum is $US74 million smaller than sought, with Paris saying it would not lend more because of the territory's already high debt level.
In 2020, France had already given New Caledonia a $US270 million loan to cope with the pandemic.
Sebastien Lecornu Photo: AFP or licensors
The French overseas minister Sebastien Lecornu said the new loan from the French Development Bank secures the entire social system, which means New Caledonia's pensions as well as the salaries paid by the hospital.
After reaching the loan agreement with New Caledonia's president Louis Mapou, Mr Lecornu said he welcomed New Caledonia's willingness to honour the commitments for structural reforms made by Mr Mapou's predecessor in the first half of 2020.
New Caledonia's President Louis Mapou Photo: Clotilde Richalet / Hans Lucas
An expert quoted by the news agency AFP said among the measures being considered in Noumea are changes to income tax, a sugar tax, the abolition of some tax loopholes as well as a real estate capital gains tax and a higher levy on mining exports.
New Caledonia's nickel-dependent economy has had difficulties with sagging commodity prices and high production costs but in recent months, there has been a sharp increase in the price of nickel, giving a boost to the local producers.