An overview of Papua New Guinea’s planned sovereign wealth fund.

The PNG Government has committed itself to establishing a Sovereign Wealth Fund (SWF), administered according to international standards of governance, to hold revenues from its stakes in resources projects such as the ExxonMobil-led PNG LNG Project. So far, however, these projects have not provided any extra tax revenue that could be put in such a vehicle.

The Organic Law to establish a ‘offshore invested, onshore managed’ Sovereign Wealth Fund was passed in July 2015.

The aims of the SWF are three-fold:

1. To support macroeconomic stabilisation
2. To support the development goals of the PNG Government
3. To support the management of State assets accrued from natural resources revenue.

It consists of two funds: a Stabilisation Fund and a Savings Fund.

In his 2016 National Budget Speech, Treasurer Patrick Pruaitch asserted that revenue would start flowing into the fund in 2016, and that revenues flowing into the Stabilisation Fund will be drawn down into the Budget to fund key priority policy areas.

As of July 2020, funds had not flowed into the SWF, however.

Further information: www.treasury.gov.pg