The world’s third-largest island country by area, Papua New Guinea is expected to grow its economy by 4.8% this year from 2.7% in 2023, according to the World Bank’s April 2024 forecast.
With economic expansion, the influx of foreign capital continues. According to data from Trading Economics, foreign direct investment (FDI) in Papua New Guinea increased by $190.1 million (747.10 million PGK) in the third quarter of 2023.
What makes PNG an attractive investment destination?
Papua New Guinea’s National Trade Portal (NTP) points to the country’s natural resources as the main driver of foreign investment, specifically its mineral reserves.
According to Trade Minister of Richard Maru, the country is rich in gold, copper and silver with several active mining operations, including the state-owned Ok Tedi copper and gold mine.
In addition to minerals, PNG also has significant potential in the oil and gas sector. According to data from the NTP, the country is estimated to have total gas reserves of almost 15 trillion cubic feet. It is also home to significant reserves of oil and natural gas and has several major oil and gas projects currently under development, like the PNG LNG project.
Another key FDI attraction is infrastructure development
According to the NTP, foreign construction and engineering companies will find significant investment opportunities in Papua New Guinea’s large infrastructure deficit as the country needs new roads, ports, airports, production facilities and technology.
According to 2020 data from PWC, more than 4,500 foreign companies have investing in PNG, over 800 of which are in infrastructure development.
Papua New Guinea Prime Minister James Marape said in a statement that more investment was welcome in all sectors of the PNG economy as he reaffirmed the country’s openness to trade and eagerness to attract more FDI, especially in the country’s agricultural sector.
“I want PNG to be known as the food basket of Asia-Pacific,” the prime minister said.
