France has strengthened its support for Papua New Guinea's green economy with a EUR15 million (approximately K75 million) commitment aimed at expanding green lending for small and medium-sized enterprises (SMEs), renewable energy projects, sustainable agriculture and other environmentally responsible investments.
The commitment was formalised on May 27 during the 2026 Green Finance Summit at the Hilton Hotel in Port Moresby through the signing of a Letter of Intent between the Agence Française de Développement (AFD), the Bank of Papua New Guinea (BPNG) and the Global Green Growth Institute (GGGI).
The agreement marks a significant step in PNG's efforts to expand climate-resilient financing and mobilise private-sector investment for sustainable development.
French Ambassador to PNG Pierre Fournier and AFD Country Representative Benoît Chassatte joined BPNG Governor Elizabeth Genia and GGGI Country Representative for PNG, Solomon Islands and Vanuatu Muhammad Ali Shaikh in formalising the partnership.
In addition to the Letter of Intent, AFD and BPNG signed a financing agreement for the Green Guarantee Facility, further strengthening the country's green finance framework.
The EUR15 million investment will be channelled through PNG's Green Finance Facilities — the Green Refinancing Facility and the Green Guarantee Facility — to increase lending for environmentally sustainable projects through participating financial institutions.
The funding is expected to unlock additional private-sector investment in renewable energy, energy-efficient buildings, sustainable agriculture, organic produce processing and retail, while supporting businesses seeking to adopt more sustainable practices.
Speaking at the summit, Genia said the agreement reflects the growing urgency of addressing climate risks while ensuring financial inclusion remains central to PNG's green finance agenda.
"We must be ambitious and we must also act with urgency. The need to build climate resilience is no longer a future challenge; it is an urgent reality affecting our communities today," she said.
"Financial inclusion must remain at the heart of this agenda, ensuring that green finance supports our rural communities, SMEs, women-led enterprises, and all Papua New Guineans striving to build a more resilient future."
Under the agreement, AFD, BPNG and GGGI will work with the Green Finance Centre to identify and develop a pipeline of green loans aligned with Papua New Guinea's Inclusive Green Finance Taxonomy.
The partnership will also explore additional financing opportunities from development partners to complement AFD's investment and support the long-term sustainability of the facilities.
With continued support from the central bank, the Green Finance Centre is expected to play a key role in advancing the facilities, coordinating implementation and facilitating any required government approvals.
AFD will also explore opportunities to expand the facilities, while GGGI will continue providing technical assistance, implementation oversight and institutional capacity-building support.
Shaikh described the agreements as the culmination of years of collaborative technical work and an important step in advancing PNG's long-term green growth ambitions.
"I would also like to acknowledge the Financing Agreement signed today for the Green Guarantee Facility between the Bank of PNG and AFD, and the Letter of Intent between the Bank of PNG, AFD and GGGI on additional funding into the green finance facilities," he said.
"These are partnerships built on years of careful technical work, and they will support PNG's green growth for years to come."
Chassatte said AFD was proud to support the implementation of PNG's green finance roadmap and the progress achieved by the central bank and its partners.
"AFD feels privileged to be a special partner to accompany and support BPNG in implementing the green finance roadmap," he said.
"We are proud of BPNG's accomplishments as we are about to harvest the fruits of unwavering efforts. These have led to the establishment of the Green Financing Facilities and, shortly, to the first green investments being financed through the facilities. We will soon be celebrating the success of this team effort."
The Letter of Intent will remain in effect for an initial two-year period, providing a framework for continued collaboration, knowledge sharing, resource mobilisation and coordinated action to advance green finance and climate-resilient development in Papua New Guinea.
The signing underscores the shared commitment of BPNG, AFD and GGGI to drive inclusive economic growth, strengthen climate resilience and support a greener future for PNG, while highlighting the growing momentum behind green finance initiatives across the country.
