PNG’s new economic agenda mapped out in report

The latest report by the global research and consultancy firm, Oxford Business Group (OBG), on Papua New Guinea looks in detail at the country’s efforts to attract investments that can support inclusive growth and boost economic diversification.

The Report: Papua New Guinea 2019 analyses the government’s ambitions to generate more fiscal and social benefits from extractive projects over the medium- to long-term, and the likely challenges they will face in implementing changes to the legal framework governing resource projects without impacting PNG’s attractiveness as a destination for FDI. In particular, it focuses on the likely economic multiplier effect of the $13bn Papua LNG project, which was cleared to proceed in September 2019 after a protracted review period.

The publication also shines a spotlight on PNG’s mining industry, which accounts for almost one-third of GDP, but remains constrained by regulatory uncertainty and, in some cases, community opposition. In addition, it charts the public works projects in the pipeline, which, together with social housing initiatives, are expected to help PNG’s construction sector maintain momentum, following the implementation of several accelerated transport infrastructure initiatives for PNG’s year as chair of the Asia Pacific Economic Cooperation (APEC) forum in 2018.

PNG’s agriculture, forestry and fisheries industries are a key focus in OBG’s report, reflecting the government’s plans to bring them centre stage as it looks to diversify the economy away from a dependence on energy and mining. The Report: Papua New Guinea 2019 considers the major role that agri-business projects and food processing could play in taking the sector forward, and how special economic zones could help to attract investments in this area.

The Report: Papua New Guinea 2019 contains an interview with Prime Minister James Marape, together with a detailed sector-by-sector guide for investors.

It also features a wide range of interviews with other high-profile personalities, including: Peter Botten, Managing Director, Oil Search; Wapu Sonk, Managing Director, Kumul Petroleum; Paul Komboi, Managing Director, DataCo; and Stephanie Fahey, Chief Executive Officer, Austrade.

Commenting ahead of the launch, OBG’s Editor-in-Chief, Oliver Cornock, said while regulatory hurdles and a shortage of land for development continue to present challenges for PNG, efforts to highlight the country’s potential to visitors from fellow Asia-Pacific states in 2018 were already delivering results.

 “The APEC meetings have given PNG plenty of timely opportunities to forge new global partnerships with businesses from the region and beyond,” he said. “These new deals are expected to unlock new growth areas and help the country diversify economic output which ranks high on the government’s list of objectives.”

Patrick Cooke, the Group’s Regional Editor for Asia, added that measures aimed at improving public governance, together with other key reforms, were expected to further bolster investor confidence.

“While PNG’s abundance of natural resources is already a draw for the international business community, moves to implement prudent fiscal and monetary policies to keep the economy stable will provide investors with additional reassurance,” he said. “Other issues remain a concern, such as PNG’s high dependence on imports and fluctuating commodity prices. However, promising growth forecasts suggest the country has plenty to feel positive about in the coming year.”

The Report: Papua New Guinea 2019 marks the culmination of 12 months of field research by a team of analysts from Oxford Business Group. The publication assesses trends and developments across the country, including those in macroeconomics, infrastructure, banking and others.

The Report: Papua New Guinea 2019 has been produced with the Investment Promotion Authority. Contributions have also been made by PwC and Leahy Lewin Lowing Sullivan Lawyers. It is available online and in print.  

Press release