Commerce and Industry Minister, Wera Mori, says the government is focusing on new laws to open up Papua New Guinea’s capital markets to attract foreign investment. He also told business leaders in Port Moresby that the government alone cannot rebuild the country’s economy and has called for a new bond between the state and the business community.
Commerce and Industry Minister Wera Mori. Credit: Loop PNG
Commerce Minister Wera Mori says the government wants to open up PNG’s capital markets to attract foreign investment.
He indicated this would be done through the Port Moresby Stock Exchange (POMSOX), which would be opened up to include listings of investment trusts like special-purposes entities (SPEs).
Clearing house
He later told reporters the SPEs would be used for large infrastructure and development projects. SPEs are independent companies owned by many shareholders from the public or private sector.
Mori said the Act would ensure the Exchange would ‘become a clearing house for foreign equity and foreign direct investment’ and indicated the Securities Commission Act would be revived.
‘I am working with my department to eradicate loopholes preventing direct foreign investment.’
Increased dialogue
Mori also urged greater dialogue with the business community to achieve what he called the ‘mammoth task’ of creating 500,000 small and medium-sized enterprises (SMEs) by 2030.
It means, he said, creating an average of 40,000 SMEs annually for the next 12 years.
Mori also called on stakeholders in the agriculture sector to begin talks on how to improve national development and open up food export markets.
He said there had been over-emphasis on the non-renewable extractive industries and the lesson has been ‘not to put all our eggs in one basket’.
He said in the past 10 years, agriculture had performed way below expectations, but the Trade and Commerce Department would work closely with the Agriculture Department to drive forward key agendas linking trade and agriculture.
Market development
In a separate presentation, Jawad Khan from the Australian government-funded Market Development Facility described some of the successes they have had in getting PNG farmers’ products to market.
In 2014, the MDF established NKW Fresh, a fresh produce-buying company, aimed at strengthening the supply chain. It has developed a database to help identify and track farmers, and employed four field officers to help farmers with crop planning.
The extension team has been training 700 existing farmers and 250 new farmers near the Hidden Valley Mining Project in Wau, Morobe Province.
Before instituting this business model, said Khan, NKW was only able to access 30–40 tonnes of produce per month, but it is now procuring 100 tonnes per month.
‘It took just over seven-to-eight months of work. So they were able to provide a very simple solution to a major market challenge.’
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Whilst we appreciate the Government’s target to reguster 40,000 SMEs annually, it is high time that the income tax system be reformed to allow SMEs to grow. The current tax system is killing businesses.
Most SMEs must be agriculture related because they cannot fail. Encouraging people to plant more coffee, cocoa, copra and oil palm on their own tribal lands should not pose much of a problem. All primary produce like coffee, cocoa, copra and oil palm will be sold on the world market to earn foreign currency which we desperately need as a country. Building good road systems to our isolated communities and encouraging our local farmers to go into farming through provision of easy loans, ensuring availability of extension officers and providing good roads for easy market access will definitely help develop this nation.