The Asian Development Bank (ADB) and Air Niugini Limited (Air Niugini) have signed a US$35.8 million financing package to help modernise the fleet of Papua New Guinea’s (PNG) national airline, improving its efficiency and further raising safety standards.
This initiative will enhance PNG’s domestic and international connectivity and contribute to the island nation’s social and economic growth.
The package includes a US$19 million loan from ADB’s capital resources and a US$16.8 million loan administered by ADB from the Leading Asia’s Private Sector Infrastructure Fund 2 (LEAP 2). The funds will finance the purchase of six Airbus A220-100 aircraft, replacing older models with more reliable, fuel-efficient planes.
“This project highlights ADB’s commitment to sustainable and inclusive development in PNG,” said Officer-in-Charge of ADB’s Papua New Guinea Resident Mission Soon Chan Hong. “By supporting Air Niugini’s fleet renewal, we aim to improve the country’s connectivity, boost economic growth, and enhance air travel safety in the Pacific region.”
Air travel is crucial for PNG’s economy, as the country’s challenging terrain limits land transport options. Air Niugini plays a central role in connecting communities both domestically and internationally. The new aircraft are expected to be 20 percent more fuel-efficient than older models, reducing costs and environmental impact.
LEAP 2 is an ADB-managed fund with a US$1.5 billion commitment from the Japan International Cooperation Agency. It focuses on sustainable private sector infrastructure projects that reduce carbon emissions, improve energy efficiency, and provide affordable health care, education, and communication services to ADB’s developing member countries.
Founded in 1973, Air Niugini is PNG’s national airline and a wholly state-owned enterprise, operating an extensive domestic network and international routes to Australia, Asia, and the Pacific. The airline is committed to safe, reliable, and efficient service, supporting PNG’s economic and social development.
