Gov’t secures VT2 billion Airbus deal

July 28, 2025 10:35 pm | Posted in Business News | Share now TwitterFacebook

By Doddy Morris.

Vanuatu’s controversial Airbus aircraft deal worth over VT2 billion has been revived following successful high-level negotiations in France, Prime Minister (PM) Jotham Napat confirmed upon his return to Port Vila yesterday.

The PM, who led a government delegation to France last week, described the outcome of the mission as “very successful and very positive,” with Deputy Prime Minister (DPM) and Finance Minister Johnny Koanapo managing to resolve key issues during a critical meeting with Airbus executives in Toulouse.

“The issue in terms of Airbus has been very positive,” PM Napat said. “We thank the Deputy PM who met with the Vice President of Airbus and managed to resolve the matter. Because of commercial conditions, we were at risk—but we did not lose anything.”

The deal, signed in 2019, involved the purchase of four Airbus A220 aircraft for Air Vanuatu as part of an ambitious national airline expansion plan. However, it stalled due to financial constraints, the impact of the COVID-19 pandemic, and subsequent political instability. Concerns grew over the fate of an estimated VT2 billion in Pre-Delivery Payments (PDPs), which aviation experts warned could be forfeited if the deal collapsed.

Airbus previously told the Daily Post that contractual defaults “typically result in the loss of pre-delivery payments,” which can total up to 30 percent of the aircraft value.

The PM’s assurance that the money has not been lost signals a major breakthrough and a possible new direction for Vanuatu’s aviation sector.

Deputy PM Koanapo, who traveled ahead of the PM, was tasked with addressing the Airbus matter directly. He is expected to return to the country today, after finalising follow-up talks.

In Paris, PM Napat met with French President Emmanuel Macron to discuss bilateral cooperation, investment opportunities, and unresolved regional issues—including the maritime boundary dispute over Matthew and Hunter Islands.

“A joint statement will be issued once France clarifies its position on Mathew and Hunter,” PM Napat told reporters.

PM Napat said that further updates from the trip will be delivered in the lead-up to the country’s 45th Independence Anniversary, including announcements on economic partnerships and aviation progress.

The Airbus breakthrough not only secures a major financial investment but also signals renewed efforts to strengthen Vanuatu’s air connectivity and its ties with strategic partners like France.