Papua New Guinea’s two major cities, Port Moresby and Lae, are the heartbeat of the economy. David Conn, Chief Executive of the Port Moresby Chamber of Commerce and Industry (POMCCI) and Alan McLay, President of the Lae Chamber of Commerce (LCCI) reflect on the changes that have occurred in their respective cities over the last decade.

David Conn: Port Moresby grows up

In the nation’s capital, it’s just exponential change. It is very, very heartening to see. Port Moresby has really grown up in the last 10 years and the infrastructure development continues apace.

POMCCI’s David Conn

If you compare it with 10 years ago, I think it has shaken off the mantle of being a dangerous place. More and more people are coming in and saying: ‘What’s the fuss? This is a vibrant city in a developing country.’

With law and order moving back down the scale it is being replaced by different issues. The energy situation has become critical and in many ways that was inevitable. When you see such exponential growth in the city the infrastructure—power, water, sewerage, drainage—is all creaking and groaning.

But there are many encouraging things in the energy sector coming, so Moresby is heading to be very well covered in that regard—it’s going to be a lot better for business as well.

I think it is positive that the port is moving to the northern side of the harbor.

It is all happening in Port Moresby. I visited Vision City, a shopping mall that would be the measure of any shopping mall in Asia, sitting under a new 433 room hotel—the Stanley. There are six new restaurants opening in Steamship’s Harbourside development. You have one of the most magnificent harbours in the world that you are sitting on.

You just need to drive around Port Moresby to see what is happening. People are gentrifying: old fibro shacks have come down and people are building half a dozen units on the block of land.

I hope for a better quality of life for everybody in Port Moresby.

New road infrastructure is opening up massive areas of real estate on the fringes of the city. Many of us thought that a lot of these traditional settlements would never go, and that’s been proven wrong. I like to see development translating to a better standard of living for people.

Port Moresby

I think it is positive that the port is moving to the northern side of the harbor. It is going to be well connected by a new road. I would like to see some consideration given to the spin-offs in that economic development corridor around the harbor.

There’s huge potential there. I’d like to see Hanuabada, Tatana Island, Baruni—places sitting right on the fringes of the nation’s capital—developing as well.

I hope for a better quality of life for everybody in Port Moresby.

David Conn is the Chief Executive Officer of the Port Moresby Chamber of Commerce and Industry.

Alan McLay: Lae well placed

Thank goodness the name: ‘Lae: the Pothole City’ hasn’t stuck. Ten years ago it was synonymous with Lae because most of the arterial road complex in the city had collapsed.

LCCI President, Alan McLay. Credit: The Loop

This had a dramatic effect on how business was conducted in the city. Bad roads added costs to business:

• vehicles had to be repaired or replaced more often;
• Employee punctuality was a problem because buses ran late, or in extreme cases just did not operate;
• The health of workers was poor, particularly with respiratory illnesses. This caused downtime;
• Dust affected machinery and caused stock to become filthy;
• Deliveries were difficult.

In 2008, a program to seal Lae’s roads was commenced. It gained momentum in 2011, when the concreting of major city roads was started.

Now, only a few major roads are yet to be sealed. Unfortunately, these are the most important roads in the city, especially the last kilometer of Milfordhaven Road leading to the Lae Wharf. It is the main artery for normal traffic, as well as all the trucks and heavy vehicles to and from the port.

We are hopeful that these roads will be sealed in 2016.

‘There was little available land in Lae Township itself, which meant that much of the development was in the direction of the Nadzab airstrip.’

The PNG LNG gas development in the Highlands brought ancillary business to Lae, which saw the city expand quickly. There was little available land in Lae Township itself, which meant that much of the development was in the direction of the Nadzab airstrip.

This development was haphazard but a new Urban Development Plan currently being done by professional town planners provided by JICA (the Japanese International Cooperation Agency) will cater for Lae’s continued expansion as far as the Erap River, just past Nadzab.

‘Business houses have commenced planning for future international flights from Nadzab.’

In November 2015, PNG again signed a deal with JICA for Nadzab airport to be extended, with K560 million funding, starting in 12 month’s time. It will allow for a new terminal, runway improvement and provision for airport-related businesses.

Lae Port. Credit: Skyscrapercity

The completion of the ‘super-highway’ from Lae to Nadzab will guarantee swift access to these new facilities from Lae. Business houses have commenced planning for future international flights from Nadzab and the Lae Chamber of Commerce hopes these will benefit not only businesses in Lae but those in the Highlands, Madang and Islands as well.

PNG is experiencing a business slump and Lae is no exception. As the manufacturing hub of PNG, the shortage of ready cash in the country has resulted in a downturn in business across the board.

However, when the economy recovers, Lae is well placed to pick up quickly and will be able to operate more efficiently, taking full advantage of the improved infrastructure.

Alan McLay is President of the Lae Chamber of Commerce.

This article was first published in the 10th anniversary edition of Business Advantage Papua New Guinea, PNG’s annual business and investment guide, which is published this month.