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Development assistance in Papua New Guinea

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Infrastructure support to Papua New Guinea

Australia Infrastructure Financing Facility (AIFFP)

The Australian Infrastructure Financing Facility for the Pacific (AIFFP) is partnering with the PNG Government and the private sector, to deliver lasting benefits for communities and the economy by responding to critical infrastructure priorities. The AIFFP finances quality, climate resilient infrastructure investments that adhere to robust social and environmental safeguards and maximises development outcomes, like job opportunities, during construction.
 

Aerial photo of local contractors painting white lines on a road.
Local contractors working on upgraded road in Buin 2018. Credit: Palladium Group.

In partnership with PNG Ports Corporation, Australia is financing through the AIFFP, a $580 million investment to repair and upgrade key ports around the country through the PNG Ports infrastructure program. The investment will transform Lae Port to be the key deep-water port servicing the Highlands and surrounding areas, as well as accommodating container ships to become the Pacific’s premier transhipment hub. The wharf upgrades will benefit remote local communities, increasing their access to transport, essential services such as healthcare, as well as goods and trade. The ports are designed to withstand future climate change related shocks and stresses and will as a result have a design life of at least 50 years.

Australia also remains closely engaged with Papua New Guinea, Japan, New Zealand and the United States to deliver the PNG Electrification Partnership (PEP). Overall, Australia is expected to contribute more than $250 million via the PEP (through the AIFFP and Australia’s bilateral program) to extend, expand and improve PNG’s electricity grids, build institutional capacity, strengthen policy and regulatory settings, mobilise private sector investment and provide clean energy to rural and remote communities. Recent Australian investments though PEP include Pawarim Komuniti, a $25 million off-grid electrification grant program to support access to clean energy services in rural and remote communities throughout Papua New Guinea. Electrification will improve living standards and lift economic growth.

Together with PNG Power Limited, Australia through AIFFP’s $85.8 million Laitim Hauslain investment will connect between 150,000-200,000 individuals to the electricity grid for the first time including households, schools and health clinics.

Roads are critical to connecting communities to services and markets and allowing businesses to grow. As part of our bilateral program, Australian support for road infrastructure saw more than 1,850 kilometres of Papua New Guinea’s national priority roads maintained in 2021‑22. In East New Britain, road improvements to the New Britain Highway (26-kilometre resealing) have reduced travel times, allowing students to arrive at school on time and leave at the end of the school day because they can now return home before dark.

Working in partnership with the Government of Papua New Guinea, Department of Works and Highways, AIFFP is also investing in the upgrade of the Wau and Sepik Highways investment, which will maintain 359km of critical roads linking remote rural agricultural communities. Along these highways, small-scale producers of fresh food, cocoa, fish, rubber, coconuts and vanilla, along with the mining, forestry, cattle and large-scale poultry industries, will have a faster connection to domestic and international markets. Remote communities, especially women and children, will have better access to essential services, such as health and education. At least 600 jobs in the road sector will be created annually with a focus on increased access for women to jobs, ensuring more of the economic benefits from this project stay in the community.  This investment is delivered in alignment with the Transport Sector Support Program.

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Papua New Guinea (AIFFP)

PNG-Aus Transport Sector Support Program

TSSP commenced in 2007 as a 15-20 year commitment to support the Government of PNG to achieve a safer, more reliable transport system, enabling economic and social development. This investment provides capacity building and technical assistance to transport sector agencies in the land, maritime and aviation sectors for improved governance and reform; support services for the transport sector coordination body – Transport Sector Coordination, Monitoring, and Implementation Committee (TSCMIC) and Secretariat; and policy advice, strategic direction, and financial and procurement oversight for the program.

Related documents*

Name of document Year published Type
Design and Implementation Framework 2013 Design
Road Management in PNG: An evaluation of a decade of Australian Support 2007-2017 2018 Evaluation
ODE brief – Road Management in PNG: An evaluation of a decade of Australian Support 2007-2017 2018 Factsheet
Papua New Guinea Oro Bridges Reconstruction Project: Evaluation study 2018 Evaluation
Australia-PNG Memorandum of Understanding on Cooperation in the Transport Sector 2021 Memorandum of understanding

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Joint Understanding Technical Enabling Unit

This investment oversees a range of infrastructure projects in PNG, including new buildings at the Pacific Institute of Leadership and Governance and the University of PNG. This investment is also overseeing Australia’s efforts to rehabilitate infrastructure in earthquake affected areas of PNG’s highlands (following the 26 February 2018 earthquake) and provides a range of specialist advice on other infrastructure projects – such financial, technical, engineering, legal and procurement.

Incentive Fund

The Incentive Fund is a competitive grants-based infrastructure program that has been in operation since 2000. It provides high-performing organisations with grants to improve service delivery or provide economic opportunities for the people of PNG.  This investment supports activities in a wide range of sectors including health, education, water and sanitation, agriculture and rural development. Partner organisations include local level government, faith-based organisations, non-government organisations, schools, and health authorities. The Incentive Fund is governed by an independent Board comprised of respected, experienced and diverse Papua New Guineans, and representatives from the Australian and Papua New Guinean Governments.

Related documents*

Name of document Year published Type
Incentive Fund Independent Progress Report 2012 Review
Incentive Fund IV Design 2014 Design
Incentive Fund Review of Phase 1 to 4 2024 Review and management response

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Economic and Social Infrastructure Program

The Economic and Social Infrastructure Program (ESIP) improves the prioritisation, quality, and sustainability of infrastructure investment in PNG. The investment works in different subsectors at the project, sectoral and national levels. It leverages project-level activities to create opportunities for deeper engagement in sector-wide planning and policy, and enables the identification and resolution of broader national level policy, financing and planning reforms and partnerships necessary for sustained long term change.

Related documents*

Name of document Year published Type
PNG Economic and Social Infrastructure Program (ESIP), Design Document, April 2018 2018 Design

Coral Sea Cable System (CS²)

This system is a 4,700km fibre optic submarine cable linking Sydney to Port Moresby, Papua New Guinea and Honiara, Solomon Islands. The cable has been in operation since February 2020 and can deliver up to 20 Tbps of capacity to PNG, a substantial improvement to the previous cable capacity of less than 0.1 Tbps. CS² has reduced the wholesale price of data, and improved the quality and accessibility of internet in PNG. This will have continued economic and social benefits including in e-commerce, education and health.
 

Photo of boats inspecting floating devices in the ocean attached to the Coral Sea Cable.
Coral Sea Cable coming ashore in PNG. Credit: Vocus.

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Coral Sea Cable System

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