The Asian Development Bank (ADB) and Air Niugini Limited have signed a $35.8 million financing package to modernise Papua New Guinea’s national airline, boosting efficiency and safety standards. The initiative is expected to strengthen both domestic and international connectivity while supporting the country’s social and economic growth.
The package includes a $19 million loan from ADB’s capital resources and a $16.8 million loan administered by ADB through the Leading Asia’s Private Sector Infrastructure Fund 2 (LEAP 2). The funds will be used to purchase six Airbus A220-100 aircraft, replacing older planes with more reliable, fuel-efficient models.
“This project highlights ADB’s commitment to sustainable and inclusive development in PNG,” said Soon Chan Hong, Officer-in-Charge of ADB’s Papua New Guinea Resident Mission. “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 essential in PNG due to the nation’s challenging terrain, which limits land transport options. Air Niugini plays a central role in linking communities both domestically and internationally. The new aircraft are expected to be about 20 percent more fuel-efficient than older models, reducing operational costs and environmental impact.
LEAP 2 is an ADB-managed fund with a $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 expand access to health care, education, and communication services in ADB developing member countries.
Founded in 1973, Air Niugini is a wholly state-owned enterprise, operating an extensive domestic network and international routes to Australia, Asia, and the Pacific. The airline supports PNG’s economic and social development through safe, reliable, and efficient service.
ADB, established in 1966 and owned by 69 members, is a multilateral development bank supporting inclusive, resilient, and sustainable growth across Asia and the Pacific. The bank works with partners to tackle complex challenges, develop infrastructure, and promote environmental sustainability.
