AFD Group in Papua New Guinea: Boosting Biodiversity Protection to help Island States Cope with Climate Change

AFD also signed its first bilateral agreement with PNG on energy transition alongside New Caledonians. These commitments have culminated in the signing of several agreements to deepen cooperation in the areas of greening financial systems and port infrastructure resilient to climate change.

 

Papua New Guinea is 78% made up of forests, which represent a vital source of food security for many Papua New Guineans – 85% of whom live in rural areas – and constitute an essential part of the cultural, linguistic and spiritual identity of the country. They are also of global importance in terms of climate change and biodiversity. As such, the forests of Papua New Guinea represent one of the world's most vital stores of carbon and biodiversity. 

France is engaged, alongside its regional and European partners, in supporting Papua New Guinea in the pursuit of its Sustainable Development Goals and combating climate change. President Macron’s official visit to Papua New Guinea on 28 July is a clear testament to this commitment. Indeed, it culminated in a raft of pledges in support of a climate and biodiversity protection agenda.

The European Union entrusts Expertise France with the implementation of a major project concerning forests and biodiversity

 

The environmental protection of Papua New Guinea's forests, as well as the promotion of "greener" sources of social and economic development, is a priority of the Government of Papua New Guinea. In 2022, the European Union has decided to set up a new, major cooperation program in Papua New Guinea in the field of forestry, climate change and biodiversity (FCCB).

The national and institutional components of the program, with spin-offs at the local/community level, will be implemented by Expertise France with a budget of €33.5 million. 

Expertise France’s actions are aimed at:

• Effective implementation of evidence-based FCCB policies, governance and institutional frameworks
• Improved FCCB awareness, knowledge, capacity and mobilization
• Increased gender-responsive and inclusive green growth

France’s support for the Country Package, for Forests, Nature and Climate in Papua New Guinea

France will also support PNG's efforts by contributing to the establishment of a "country package" for "Forests, Nature and Climate". The objective is to contribute to the mobilization of funds from the international community to help PNG achieve the objectives of 30% of protected areas on land and at sea by 2030 (the “30x30” objective).

As a first step, Expertise France will deploy an international technical expert (ETI) and technical assistance to the inter-agency task force of the PNG government in charge of the design and coordination of this Country Package in PNG. Combined with the EU-FCCB program, this Country Package support mechanism will form part of a major "Team Europe Initiative" to support PNG's efforts in this area of intervention.

AFD signs several agreements to deepen cooperation in the areas of greening financial systems and port infrastructure resilient to climate change

• Signing of €800,000 energy-transition FEXTE financing agreement

This FEXTE financing is a partnership between AFD, ENERCAL (New Caledonia’s public power generation, distribution and transmission utility), and PNG Power Limited, to support Papua New Guinea’s efforts in managing the intermittent nature of renewable energies on its national power grid by leveraging expertise and technical cooperation. 

This is the first financing agreement signed by AFD in Papua New Guinea and builds on AFD’s “100% Paris Agreement” commitment, and the enhanced regional integration of French local authorities in the Pacific. 

• AFD, Global Green Growth Institute (GGGI) and Bank of Papua New Guinea sign letter of intent

AFD is seeking to build the capacity of central banks and public development banks in Oceania to incorporate climate risk in their operations and raise financing for climate change mitigation and biodiversity conservation.

This approach is aimed at supporting island states facing the staggering costs of natural disasters to their economies (5% of regional GDP per year, i.e. €1 billion). 

AFD is joining forces with PNG, New Zealand and GGGI to green Papua New Guinea’s financial system and incentivize stakeholders. Starting next year, AFD is looking to scale up deployment of the Green Finance Center and support the provision of appropriate financial tools and incentives to the Bank of PNG and the country’s financial institutions. 

• Statement of intent signed between AFD, the European Commission, EIB, the Australian Government Department of Foreign Affairs and Trade (DFAT) and state-owned PNG Ports Corporation Limited (PNGPCL)

AFD pledges to work with its European partners to finance rehabilitation of the country’s port infrastructure. The goal is to support PNG in developing an eco-friendly infrastructure model in terms of waste management, wastewater, greenhouse gas emissions, and in making the country’s infrastructure itself, resilient. 

As AFD and its partners identify tangible cooperation opportunities, a joint mission was undertaken in spring 2023 to clarify our intentions and expectations. 

In 2023, AFD will contribute €500,000 (PGK 2 million) to support a feasibility study for PNG Ports Corporation Limited, as part of its broader investment program.