Calls for urgent action and investment incentives to boost non-mining sectors


Two respected trade and industry leaders have urged the government to boost investment in agriculture and non-mining sectors, warning a failure to act soon could induce ‘the dreaded Dutch Disease’.

The Department of Trade's Max Rai

The Department of Trade’s Max Rai

The head of the trade division of the Department of Trade, Commerce and Industry, Max Rai, wants the government to provide incentives to attract foreign investment in industries other than mining.

Former Ambassador Rai was a keynote speaker at the annual National Development Forum, organised last week by the Institute of National Affairs in Port Moresby.

Rai told the 400 attendees the department, would be undertaking a review of the ‘reserve list’ to determine which sectors to protect and which to open for competition.

With Papua New Guinea strategically located near markets in the Pacific and Asia, he said it was vital that it play a proactive role in current and future trade arrangements to further its interests.

Among his suggestions for foreign direct investment incentives were:

  • Low corporate tax and individual income tax rates;
  • Tax holidays and other types of tax concessions;
  • Preferential tariffs;
  • Creating Special Economic Zones, and,
  • Creating Export Processing Zones.
Sir Brown Bai

Sir Brown Bai

Rai’s comments echo those of the Rural Industries Council chairman Sir Brown Bai, who called on the government to set aside five per cent of the increased GDP resulting from the LNG project to develop the agriculture sector.

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‘We are experiencing big growth of revenue inflow from LNG. When that passes away you will go back to where you came from and what will happen?

‘Agriculture has fallen, unemployment is going up and nutrition is going the other way. We have a problem and for me it is very hurtful that we are rich yet poor,’ he said.

Bai warned that failing to act would only result in ‘the dreaded Dutch Disease’, a reference to currency inflows from one big export commodity boosting the local currency and making other export commodities less competitive.

He said while agriculture is a key player in the country’s GDP, there had been too much talking with little action. It is high time the government starts putting money where its mouth is, he concluded.


  1. Leo Gage says

    Lot of the problems with roads within the central province is there is no ongoing maintenance after major improvements have been carried out. The moreguina highway is a classic example followed by the Hiratano highway when you pass doa. Keep graders and a 20ton rubber tyred digger and some 5 ton tip trucks on these roadsfull time. This will allow the people from the rural areas to get there produce to market regularly

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