The Asian Development Bank (ADB) has joined forces with Air Niugini Limited to finalize a financing package amounting to US$35.8 million aimed at modernizing the fleet of Papua New Guinea’s national airline. This initiative seeks to enhance the airline’s efficiency and fortify safety standards, playing a vital role in improving both domestic and international connectivity for the island nation.
The financing plan comprises a US$19 million loan from ADB’s own resources, along with a US$16.8 million loan administered from the Leading Asia’s Private Sector Infrastructure Fund 2 (LEAP 2). These funds are earmarked for the acquisition of six Airbus A220-100 aircraft, which will replace older models with newer, more reliable, and fuel-efficient alternatives.
Soon Chan Hong, Officer-in-Charge of ADB’s Papua New Guinea Resident Mission, emphasized the project’s significance, stating, “This project highlights ADB’s commitment to sustainable and inclusive development in PNG. 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 integral to PNG’s economy due to the challenging geographical terrain that limits land transportation. Air Niugini serves as a crucial link for communities within the country and beyond, providing essential connectivity for both residents and visitors. The introduction of the new aircraft is anticipated to yield a 20 percent increase in fuel efficiency compared to the older models, thereby lowering operational costs and reducing the environmental footprint of air travel in the region.
LEAP 2, the fund through which part of the financing is provided, is an ADB-managed initiative that has garnered a commitment of US$1.5 billion from the Japan International Cooperation Agency. It focuses on supporting sustainable private sector infrastructure projects with the aim of lowering carbon emissions, enhancing energy efficiency, and providing critical services such as affordable healthcare, education, and communication in ADB’s developing member countries.
Established in 1973, Air Niugini remains a wholly state-owned enterprise, boasting an extensive domestic network alongside international routes that reach Australia, Asia, and the Pacific. The airline’s unwavering commitment to safe, reliable, and efficient services underpins its role in supporting the economic and social advancement of Papua New Guinea. The investments in modern aircraft stand to not only enhance safety and efficiency but also serve as a beacon of growth potential for the nation as it continues to evolve and develop.
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