‘We have never experienced this, even back in the days of post World War I when we are talking about the Spanish flu. We have never had this unified shutting down of the global economy, then trying to reopen haphazardly [with] different events around the world, different monetary policies, different policies around the way COVID is treated.’

—Justin Smirk (Senior Economist, Westpac), talking during Business Advantage PNG‘s online budget briefing

This is my final Publisher’s Letter of 2020. What a year it’s been, full of unexpected business challenges, lessons … and opportunities.

BAI’s Andrew Wilkins

And, just when you thought 2020 couldn’t surprise us any more, Papua New Guinea’s politicians delivered a November parliamentary session to remember, with government MPs crossing to Opposition benches en masse, a surprise ruling from the Speaker allowing the 2021 Budget through while most of the Opposition were in their Vanimo camp, followed by adjournment until 20 April 2021. This last date is currently the subject of a legal challenge, which PNG’s Supreme Court may resolve as early as this Thursday.

At least we know the Marape government was legally constituted back in May 2019, thanks to a Supreme Court ruling last Friday.

The great debate

Whatever side you take politically, the events in Parliament highlight a debate that has been ongoing in PNG in recent years. Put simply, how does PNG benefit most from its limited mineral resources but also build a sustainable economy?

The ascent of James Marape was founded partly on a perceived need to redress an imbalance between the needs of international resources companies and local interests, and a perceived lack of attention on the non-resources economy.

This month’s reaction in Parliament suggests that, for all the progress on supporting SMEs and attempts to re-draft investment laws, many MPs have grown impatient with the pace and direction of Marape’s ‘Take Back PNG’ reforms.

The projects that could have cushioned PNG during this year’s COVID-19 downturn – Wafi-Golpu, Papua LNG and P’nyang – have been stalled and, in the case of Porgera, even reversed. The government is having to borrow more to fund its Budget deficit, while enacting a recruitment freeze and only slowly repaying the K1.207 billion it owes to the private sector.

PNG’s tourism sector is struggling particularly, but the Business Council of PNG’s Douveri Henao is arguing for broader support for affected industries.

Looking forward

Lae port, PNG’s busiest.

That said, 2021 is looking more promising. As Swire Shipping’s Country Manager Alistair Skingley observed last month, ‘the volumes [of freight] coming into PNG – and it is an import-dominant market – have not been impacted as much as the rest of the world.’

Swire is investing for a busier 2021, as are Kina Bank, Paradise Foods, Mayur Resources and many others. Treasury is predicting the economy will grow by 3.5% next year and 4.2% in 2022.

The global economy is set to grow by 5.5%, according to investment bank BMO, whose chief economist suggests PNG exports such as copper and gold are likely to be in demand.

And, while Oil Search and other resources companies are keeping their costs as low as possible, there has been reported progress made on Porgera and Papua LNG at least, with very senior delegations for both projects visiting PNG last month.

With vaccine development progressing, many will be hoping that the worst lies behind us as this extraordinary year comes to a close.

‘The PNG 1000’

Last month, I wrote about Doing Business in PNG 2020/21, our new, comprehensive digital business guide. I wish we’d had a similar resource when we first started coming to PNG back in 2006.

I also wish we’d had a reliable and up-to-date list of the key companies in the country and how to contact them. It would have saved us a lot of time and effort in our search for partners, suppliers and customers.

We now have such a list, of course, which we’ve built up over the years to include around 1000 businesses. Now we’re making it available, free, to everyone.

The PNG 1000 Business Directory went live earlier this month. It’s designed to help you find reputable and established suppliers quickly and easily. It also offers businesses a new and highly effective way of promoting themselves.

You can discover it for yourself at PNG1000.com. Consider it an early Christmas present.

All good wishes to you for a safe and happy festive season, from everyone at BAI.