Kiribati will receive a $US12 million grant to help improve the safety and resilience of inter-island transport in the western Gilbert Group.
The MV Butiraoi sank in 2018 when travelling from the group's Nonouti island to Tarawa, killing 88 people.
An investigation identified a litany of failures including overloading, a damaged ferry, a lack of safety equipment, and an inadequate response.
The Asian Development Bank and World Bank project would fund navigation aids and infrastructure on outer islands including jetties, boat ramps, and shelters.
The ADB said it aimed to "better connect those living in the outer islands to economic opportunities and critical health and education services."