Country report - PNG: An export destination?

The answer is a definite YES

The PNG financial sector is serviced in the main by three banks, they are Bank South Pacific a 100% locally owned and controlled bank, the ANZ banking Group and Westpac. BSP has been in expansion mode under the incumbent Chief Executive Ian Clyne and has expanded into Fiji and the Solomon Islands.

Next year will be another year of growth however there will be some issues e.g.

1. The LNG project is well behind schedule and this will mean continued spending in large tranches for the next three years.
2. The election next year will cause some distractions in the economy, both positive and negative, candidates will be making funds available to garner votes but there may be additional law and order issues and this can provide distractions to the economy.  Other disruptions to productivity are matters like workers in the coffee industry returning to their home villages to help their candidates in the elections.
3. Bougainville Copper Limited will now take some time to come into production.
4. There is a possibility that there could be a bursting in the property bubble in the coming 24 to 36 (probably later rather than earlier) months which will impact the banks in particular.Write-offs are expected as a result of this.

2014/15

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Presented by John Brooks
Trade Economist
The Auspacific Institute
+ 61 2 9904 1080

NOTE

John has been travelling to PNG since 1997 and has a working relationship with most companies. He is very familiar with the economy and in particular the export/ import sector of the economy and the financial system.