Strategic initiatives set to transform PNG economy

May 5, 2024 | Blog, News

Papua New Guinea is gearing up for a promising economic future, driven by strategic investments in mining, infrastructure, and small business development. As the country moves toward economic stability and growth, several pivotal projects and initiatives stand out, promising to reshape its economic landscape over the medium term.

The mining sector is witnessing significant activity, notably through the entry of Newmont Corporation following its acquisition of Newcrest Mining. This development revives the US$5.8 billion Wafi-Golpu project, a joint venture with Harmony Gold, expected to jumpstart economic activity and employment in Morobe Province​​. Another key development is the reopening of the Porgera mine, scheduled to resume full production by the third quarter of this year. This project is crucial for local economic stability and job creation, backed by a collaborative effort between the government, Barrick, and New Porgera Ltd​​.

The PNG government is also focusing on bolstering its small and medium-sized enterprise (SME) sector to meet an ambitious target of 500,000 SMEs by 2030. This initiative includes enhancing financial inclusion, providing entrepreneurial training, and improving access to commercial infrastructure. These efforts are supported by policies aimed at fostering a dynamic SME environment through preferential tendering and subsidised loans, crucial for sustained economic diversification and resilience​.

Financially, the Bank of PNG is adjusting its strategy to less aggressively intervene in the currency market compared to previous years. The central bank’s approach for 2024 is geared towards stabilising the kina, anticipating an uptick in foreign investment inflows from major resource projects​.

Infrastructure is also receiving a significant boost from the government, with increased funding aimed at improving the reliability of electricity and water services. The operationalisation of the new Lae Tomodachi International Airport, coupled with the introduction of regular international flights, is expected to open new commercial opportunities and enhance connectivity​.

Overall, Papua New Guinea’s economic outlook is cautiously optimistic. With substantial resource projects underway, a robust strategy for SME development, and significant infrastructure investments, Papua New Guinea is laying the groundwork for a diversified and robust economy. The success of these measures will be crucial in shaping the nation’s economic trajectory over the coming years.

The 39th Australia Papua New Guinea Business Forum on the Gold Coast between 13 and 15 May will look into the country’s exciting new phase of activity. Several prominent speakers including Prime Minister Hon James Marape will address the forum. Check out the list of speakers here.