ADB Provides $15 Million Financing for Naoero Airlines 737-800 Acquisition

The Asian Development Bank has signed a $15 million financing package supporting Naoero Airlines’ acquisition of a preowned Boeing 737-800, providing funding for a fleet replacement aimed at strengthening air connectivity across the Pacific.

The financing is being provided to Nauru 40997 Leasing Corporation, a wholly owned subsidiary of Naoero Air Corporation. It comprises a $5 million ADB loan, a $5 million concessional loan from the Leading Asia’s Private Infrastructure Fund 2 and a reimbursable grant of up to $5 million from the Asian Development Fund’s Private Sector Window.

Naoero Airlines will use the financing to replace an aging aircraft with the 737-800. ADB expects the replacement to increase passenger capacity while improving fuel efficiency, maintenance costs and operational reliability.

The carrier provides passenger and cargo services linking Naoero with the Federated States of Micronesia, Fiji, Kiribati, the Marshall Islands and Australia. The financing is intended to support more reliable regional passenger and freight connectivity, including trade and supply-chain links between remote Pacific markets.

The transaction was arranged through ADB’s Wayfinder Pacific program, which combines commercial and concessional funding to support private-sector investment in smaller Pacific economies. ADB described the transaction as its first private-sector investment in Naoero.

Naoero Air Corporation was established in 1996 and is wholly owned by the Government of Naoero.