THE Vanuatu Government says it remains committed to rebuilding national carrier Air Vanuatu, but warns that future financial support must come with major structural reforms to avoid repeating past losses.
The issue was raised yesterday during Oral Questions in the First Ordinary Session of the 2026 Parliament by Malekula Member of Parliament (MP) Hymak Anatole, who questioned the staffing status of Air Vanuatu and called on the Government to complete the airline’s restructuring process following liquidation.
Responding in Parliament, Deputy Prime Minister (DPM) and Minister of Finance Johnny Koanapo said the airline is slowly rebuilding under a new board after “starting from almost nothing.”
“Some progress is happening at our level as a company, especially with the new board that came in, and we are trying to restore the company from almost nothing,” he said. DPM Koanapo acknowledged that the airline requires significant capital injection from the Government but stressed that authorities are being cautious after years of heavy public spending on the national carrier.
“We spent a lot of taxpayers’ money on the company and then found out that the structure of the company was too heavy from top to bottom,” he said.
He thanked former finance ministers and former prime ministers who had previously attempted to address the issue.
According to the DPM, Air Vanuatu’s permanent staff count stood at 170 employees as of December 2025. However, he said questions remain over whether the current staffing level is appropriate, particularly as the airline is currently operating mainly domestic services and has no international aircraft flying at this stage.
He said the Government is now exploring expansion ideas to rebuild the airline’s assets and fleet.
“Today we have Twin Otters, and one more is coming next month as announced by the Prime Minister. We also have the ATR, which is still on lease,” he said.
The Minister added that improvements have already been seen within the airline, particularly in staff morale and operational performance.
“We find that there is a big improvement in every section, with motivation and morale of staff increasing. Even the delays in flight schedules have been minimised a lot,” he said.
However, he admitted that the airline continues to operate at a major financial loss.
“If you look at the financial statement of the company from 2024 to 2025, it does not make any profit; it makes a big loss,” he said.
Minister Koanapo revealed that one of the main improvements reflected in the airline’s books was the VT1.1 billion provided by the Government to pay for aircraft obligations.
“Apart from that, today Air Vanuatu needs a capital injection, and for us to resurrect the airline, we need a capital injection,” he said.
He stressed that the Government does not want to continue injecting money into the company “with the same attitude” while losses continue.
“The Government believes that we are building it from nothing and we are going to build it up,” he said.
The DPM also confirmed that the International Air Transport Association (IATA) is in the process of restoring Air Vanuatu’s “NF” airline code, which he said would assist with future codeshare arrangements and international partnerships.
“We have to be optimistic about the future of Air Vanuatu. We will not let go of Air Vanuatu,” he said.
On the issue of the VT2 billion Airbus matter, Minister Koanapo said he recently led a delegation to Airbus headquarters in Toulouse to discuss ongoing legal and contractual complications involving the aircraft deal.
He said Airbus management had requested that negotiations be handled carefully and privately through the company’s Singapore office.
“The Chief Executive Officer (CEO) of Airbus gave us assurance that negotiations should go through the Airbus office in Singapore, and they also preferred that we should not go too much on social media over issues that could undermine the reputation of Airbus,” he said.
DPM Koanapo said the Government has therefore been restrained in its public comments regarding the matter.
He confirmed that another round of negotiations is expected to take place in Singapore before the end of the year to revisit commitments between Airbus and Air Vanuatu as the Government continues efforts to restore the airline’s international operations.
Source: Daily Post