Business Profile
Economy: Although Papua New Guinea has been described as ‘a mountain of gold floating on a sea of oil’, it is a poor country and most of the population is engaged in subsistence agriculture. The most important commercial cash crops are copra, coffee, cocoa, timber, palm oil, rubber, tea, sugar and peanuts. However, the gradual discovery of exploitable mineral deposits has transformed the country. Papua New Guinea boasts the largest known supply of low-grade copper, the entire production of which is exported to Western Europe and Japan under long-term contract, and accounts for three-quarters of the country’s export earnings. Production, though, has been upset by the Bougainville insurgency.
Other identified mineral deposits include gold and chromite. Some oil and natural gas has also been located. Light industry has grown steadily, mostly to meet consumer demands: the construction industry, printing, brewing, bottling and packaging are among these. Papua New Guinea’s attempts to develop a tourist industry have been undermined by the lack of basic infrastructure and, more importantly, political instability. The country is always subject to the vagaries of the climate and natural phenomena – in recent years, it has suffered drought, flooding and an earthquake – which have caused further damage. On top of that, the Asian economic crisis of the previous autumn damaged the PNG economy. The present Government, which took office in 1999, has had more success than its predecessors in securing the support of the international financial community and foreign investors to tackle the country’s most urgent economic needs; cutting the budget deficit and stabilising the currency. An IMF-sponsored Structural Adjustment Programme was begun during 2000. Since then, inflation has been cut from double figures to eight percent, although annual economic growth remains low at one per cent. Papua New Guinea belongs to the Asian Development Bank and the South Pacific Commission. Its largest trading partners are Australia, with 50 per cent of the market, followed by Japan, Singapore and the USA.
Business: Business affairs tend to be conducted in a very informal fashion. A conventional suit will not be required – shirt and tie or safari suit are sufficient. Office hours: Mon-Fri 0800-1630. Government office hours: Mon-Fri 0800-1600.
Commercial Information: The following organisation can offer advice: Papua New Guinea Chamber of Commerce and Industry, PO Box 1621, Port Moresby, National Capital District (tel: 321 3057; fax: 321 0566; e-mail: pngcci@global.net.pg; website: www.pngcci.org.pg); or Investment Promotion Authority, PO Box 5053, Boroko National Capital District (tel: 321 7311; fax: 320 2237; website: www.ipa.gov.pg).
Conferences/Conventions: Some hotels provide facilities.
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