With Air Niugini now conducting direct flights between Townsville and Port Moresby, there is greater reciprocal interest between the two cities, explains Michael McMillan, Director of Policy and Investment for the Townsville Enterprise. He talks to Business Advantage PNG about the delegation sent earlier this month from Townsville to explore business opportunities with PNG.

The Townsville Enterprise’s Michael McMillan. Source: Townsville Enterprise

Business Advantage PNG: Why did you undertake the trade mission?

Michael McMillan: I suppose this delegation was triggered by the establishment of direct flight connections by Air Niugini from Port Moresby to Townsville. That inaugural flight took place on March 31. We had just under 20 business delegates heading over there, from May 15 through to May 19.

Business Advantage PNG: What are the advantages of the sister relationship between the two cities?

Michael McMillan: What we intend to do with a revived sister city relationship is to be very much driven by an economic and trade development agenda.

‘Its proximity to market is what has flagged a lot of interest.’

So, we will be looking at those key sectors where both Townsville and the Port Moresby economy align and consider how we might better service those interests and support development for both communities, leveraging off this direct connection. That will be in such sectors as mining equipment, technology and services, oil and gas, the health sector, education and training, infrastructure and the aid sector.

Business Advantage PNG: Why is there so much interest?

Michael McMillan: Its [Port Moresby’s] proximity to market is what has flagged a lot of interest. I think also being such an undeveloped country in many sectors lends itself to that opportunity. This program was all about identifying and understanding the risks associated in working in the market from Townsville businesses’ perspective. Also looking at case studies where those risks have been mitigated and the enterprise has managed to establish strong business connections and opportunities.

‘We looked at the political landscape and what it means to conduct business in that environment.’

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We have used a number of examples to support that. Virtually everyone came away with a positive outlook where they saw opportunities for their business interests. What we also sought to do was identify market-entry strategies. Depending on the sector, how those risks might be managed and mitigated in order to provide a foothold.

Business Advantage PNG: What are the main risks?

Michael McMillan: From a financial management perspective, how you ensure you get paid at the end of the day. We looked at the political landscape and what it means to conduct business in that environment. We are on the verge of a national election [in PNG], which will take place at the end of June and July. So, we considered whether there will be any fallout from that and what impact it might have on the political landscape.

‘With any developing market there is always an option to create a first mover advantage.’

We also looked at business registration, taxation, and the legal environment. All those are key considerations for any business considering going into an export market.

Business Advantage PNG: What opportunities is PNG looking to take advantage of?

Michael McMillan: Tourism they are looking to promote. We see that as a future market for Townsville clients. You look at the amazing diving they have and the Kokoda Trail. There is a lot on offer. PNG is looking for inward investment and access to a better range and depth of services, particularly in the professional sector, so they will be looking to draw upon that expertise to stimulate their economy. With any developing market there is always an option to create a first mover advantage.

‘How they position themselves is as different as the products and services they offer.’

If you can fill a void that exists in that market and establish yourself with economies of scale, you get a foothold and a large portion of that particular market. I think those opportunities currently exist within PNG. We are encouraging small-to-medium-size businesses across Townsville to consider PNG as a market. But each business is different. How they position themselves is as different as the products and services they offer.