Vt6 billion agreement for aviation upgrade

The Minister of Finance, Maki Simelum, yesterday signed a $US59.5 million or around Vt6 billion credit agreement with the World Bank Country Director, Franz Drees-Gross, to improve the safety and efficiency of its aviation sector, a critical pillar in Vanuatu’s continued social and economic development and a key of its disaster management and recovery activities.

The Vanuatu Aviation Investment Project will deliver sector reform, along with essential upgrades to runways, terminal infrastructure and traffic control management for Vanuatu’s international airports.

World Bank Country Director for Timor-Leste, Papua New Guinea and Pacific Islands, Franz Drees-Gross signed the agreement with Vanuatu’s Minister of Finance and Economic Management, Maki Simelum at a ceremony in Port Vila yesterday, witnessed by the Minister for Infrastructure and Public Utilities, Esmon Sai, and Senior Government officials and World Bank Officials.

“Aviation plays a vital part in Vanuatu’s economy, especially for the tourism industry,” said Maki Simelum. He stressed that: “This project will improve airport facilities in need of repair across the country, some of which are in need of urgent repairs following Cyclone Pam,” he said.

Out of the total project funding, US$ 3.8 million (Vt399 million) has been set aside for emergency reconstruction for damage to airports caused by the Category 5 Cyclone Pam, which killed 11 people and left thousands homeless in early March, 2015.

The project will invest in key aviation infrastructure and navigational and communication equipment for Vanuatu’s three international airports; Port Vila, Luganville (Santo) and Whitegrass (Tanna) including new runways lighting and improved safety and security equipment for luggage and cargo screening.

Port Vila Bauerfield International Airport will receive urgent runway rehabilitation and a new domestic terminal.

In addition, the project will finance the strengthening of Vanuatu’s aviation regulator and institutions by developing an Airport Master Plan and Aviation Sector Strategy to guide future developments as well as delivering targeted technical assistance and training to identify and support the sector’s long term needs.

“The World Bank sees this project as a priority for Vanuatu, given aviation’s pivotal role in the nation’s long term economic development,” said World Bank Country Director.

He added: “The role of aviation in the ability to respond to natural disasters was highlighted after the recent Cyclone Pam, another reason why investing in this sector is so important,” he emphasized at the signing ceremony yesterday.

The Vt6 billion for the project will be funded through a credit from the International Development Association (IDA), the World Bank’s Fund for the poorest countries. The Australian Government has committed US$300,000 through the Pacific Regional Infrastructure Facility (PRIF) for a safety and security audit and advisory support services.

In his official remarks, the Finance Minister, Maki Simelum also stated that this pursuit is not an isolated incident, but a part of the consolidated effort by the Government to pursue infrastructural development as the basis for establishing suitable foundation for growth and development.

“Aviation investment project is a furtherance of our policy direction to strengthen all avenues for growth in our effort to attain wider sustainability of socioeconomic development of our nation which we much cherish,” said Finance Minister Simelum.

The finance minister also remarked on the aging of the International Airport runway as a major concern which precipitated the fear of a threat to security of the country’s aviation development that would impose wider risk to the country’s development initiatives.

“Our quest for financial assistance began during the IMF and the World Bank Group Meetings in 2014 when my delegation met with one of the Vice-Presidents of the World Bank in Washington.

“The discussion we had followed by formal request by the Government to the Bank and we were grateful for the response obtained during our exchanges,” he recalled.

“I wish to confirm that this is an important and an urgent project that must be undertaken immediately.

“All necessary work on the part of the Government must be completed urgently, to ensure that smooth undertaking of the project be fully accomplished without further undue delay.

“I would therefore urge all development partners and stakeholders to work closely together for the smooth running of this project,” Finance Minister Maki Simelum stressed in his remarks during the signing ceremony in Port Vila, yesterday.