Lae, Papua New Guinea’s second-largest city, is again emerging as a key location for investment. Far from drawing investors away from capital Port Moresby, a buoyant Lae could actually be good for both cities, say representatives from the two cities’ business chambers.

LCCI’s John Byrne (left) and POMCCI’s Peter Goodwin (right). Credit: BAI

Discussing the differences and synergies between Lae and the capital of Port Moresby. John Byrne, Lae Chamber of Commerce’s President, told the 2019 Business Advantage Papua New Guinea Investment Conference that Lae is shaking off its tag of being the ‘pothole City’ thanks to improvements in the roads and the announcement that there will be a new A$800 million (K1.87 billion) international airport.

‘Once you have an international airport and a highway you have real access—and that is what we are really keenly looking for,’ said Byrne. ‘The Australian consulate is very new in Lae and that is a good sign for the city. So is the fact that the Bank of PNG is putting a currency operation up there, it just shows that Lae is very important in the infrastructure of PNG.’

‘A healthy Lae is a great situation to have for the country. There isn’t any competition between Lae and Moresby; a strong Lae will only complement Port Moresby.’

As the ‘gateway to the highlands’ in Morobe Province, Byrne says the city is well positioned for agricultural investment in the Markham Valley. There is a new SP Brewery cassava processing plant and abundant fields that are suitable for rice growing.

There are still challenges to overcome, such as port inefficiencies and the current state of the highway. One thing that may help speed infrastructure improvement is the touted Wafi-Golpu exploration project in Morobe, 65 kilometres south west of Lae.

It is a large-scale project that will boost infrastructure growth and confidence in the emerging region.

The more the merrier

POMCCI’s Peter Goodwin. Credit: BAI

Speaking alongside Byrne at the conference, Peter Goodwin, Port Moresby Chamber of Commerce and Industry’s Vice President, agreed that more investment in Lae would be a boost for the capital.

‘A healthy Lae is a great situation to have for the country,’ said Goodwin. ‘There isn’t any competition between Lae and Moresby; a strong Lae will only complement Port Moresby.’

Goodwin said PNG’s capital is undertaking a modernisation program to tackle crime and violence, with its settlements slowly being converted into suburbs.

‘It is about risk versus reward. It is risky, I guess, but the rewards available to you are great.’

Investors are increasingly looking beyond Port Moresby. ‘There are some negative aspects that go hand-in-hand with growth; (there is) urban drift and you have issues of law and order. We can’t forget we are an emerging nation.’

Goodwin maintains, however, that PNG is a great place to do business. ‘It is about risk versus reward. It is risky, I guess, but the rewards available to you are great,’ he said.

He pointed to a strong business community and improvements in local government as reasons to invest in Port Moresby. He said the PNG government recognises that the growth of the country is closely aligned to that of its business community.

‘If you create an environment for us businesspeople to do our thing, and let us get stuck in, with little interference, then we will do that,’ said Goodwin. ‘We become stronger and we employ more Papua New Guineans.’

Byrne agreed with Goodwin that there is no direct competition between the cities and that a rising tide would lift all ports. He said that one of Lae’s strengths lies in manufacturing.

‘We are a manufacturing city, and if you are looking to invest in this sector and grow Lae is the city to do it in,’ he said. ‘The work ethic of Papua New Guineans and their ability to learn and grow—you will not see anywhere else in the world.’