Interview: Ivan Pomaleu
What new incentives were introduced in the 2014 budget that may attract further investment?
IVAN POMALEU: Competition policy and streamlining the regulatory environment are priorities for Papua New Guinea to stimulate domestic and foreign investment. For example, the National Working Group on Removing Impediments to Business and Investments can foster important conversations between the public and the private sector, and raise awareness about the importance of public-private partnerships. When it comes to the energy sector, the government’s decision to implement the Extractive Industries Transparency Initiatives signals the government’s desire to improve the investment climate by engaging with civil society.
How can integration within ASEAN position PNG as an investment destination?
POMALEU: PNG has attained observer status with ASEAN and is currently pushing for a permanent seat, as the country is well positioned to function as a link to ASEAN economies. Domestically, this would provide opportunities to attract regional investors and supply ASEAN’s consumer market through the transfer of capital and skills to develop our extractive industries, especially oil and gas, minerals, and agricultural produce.
Regional integration would also mean that PNG would have to subscribe to key liberalisation initiatives, leading to greater uniformity in regulations across economies. This shift towards standardisation can help build a community of inter-connected nations, encouraging investment and trade growth in the long run.
To what extent should the government protect local businesses from global economic competition?
POMALEU: The government has no long-term policy to protect local industries from global economic integration. Many businesses are still in their infant stages and are therefore at a competitive disadvantage from large multinationals. The amendments to the Intellectual Property Act and the formulation of the Master Plan is intended to assure observers that there are opportunities for ordinary citizens. In November 2012, the government announced a 12-point stimulus package for the growth of small and medium-sized enterprises, including an online registry system.
Further to this, the Bank of PNG’s Financial Inclusion Programme aims to promote financial literacy and training workshops for the unbanked rural population. The aim is to educate people to open bank accounts and savings with existing financial institutions, while building their entrepreneurship skills.
Aside from extractive industries, which sectors of the economy offer the best growth opportunities?
POMALEU: The services sector offers the best opportunities given the country’s sharp population growth and increased economic activities. Considering all the major projects under way at the moment, there is a huge demand but limited supply in relation to electricity, telecommunications, finance, education, skills training and health services. The agriculture and livestock sector also offers opportunities for growth in the face of global food security issues, while high demand for real estate and a limited supply of skilled labour continues to fuel the construction sector. Lastly, the tourism industry has yet to be fully harnessed in this country.
In what ways will online business registration make it easier to conduct business in PNG?
POMALEU: Many companies from PNG are already benefitting from the Online Business Registration Programme. The system has allowed organisations, clients and users to lodge their company forms, file documents or do company searches online from anywhere. This means they do not even have to physically come to the office of the Investment Promotion Authority, which can be a costly exercise. For instance, the charge for conducting searches no longer applies. The online registry system thus represents an exciting step towards facilitating the registration and filing of documents.
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