As the world slowly returns to a “new normal” and Papua New Guinea’s population grows, opportunities abound for Papua New Guinea manufacturers. If the challenges can be met, they say, the future could be even brighter.
According to Nihal Shah, president of the Pacific Foam Group, Papua New Guinea’s manufacturing sector offers significant opportunities as its growing middle class needs to buy local products.
He believes the trend will only grow.
‘The middle class [in PNG], as in many other developing countries, is increasing,” Shah said at a recent Australia-Papua New Guinea business forum. “This part of the population, the ambitious consumer [will need more products]and we see significant medium-term growth opportunities to meet this demand. »
He has seen a significant increase in demand for locally made residential furniture.
With a population of over 10 million in PNG, “the size of the market can support a wider range of manufactured products… We believe there are many opportunities”.
Shah said these trends will continue in the “consumer goods and non-food consumer goods space.”
For agricultural processing and manufacturing, opportunities are also at hand: PNG’s immediate neighbor Indonesia is a potential market with a population of over 200 million, according to Murray Woo, chairman of the PNG Council of Makers.
Woo, speaking at the same forum, explained that in more than 25 years, exports to the country have grown at an annualized rate of 9.92%. PNG currently exports vanilla, cocoa beans, canned goods and timber to Indonesia and may export more.
Dorothy Devine Luana, chief executive of DMS Organics, a company that processes and packages galip nuts, told the forum that manufacturers need to see who’s who in the market to create synergies.
“We don’t want to import expatriates to do this job. We want to invest in the local population. We want to bring in experts to be the go-between and the trainer, but we don’t see that as a long-term solution.
She believes that there is “not much competition at present in the agri-food sector, in particular with the processing and packaging of local products which can be bought at the supermarket”.
Luana said it’s not about reinventing the wheel, it’s about finding ways to get those opportunities.
To seize these opportunities, manufacturers must address several challenges, including access to reliable power supply, better infrastructure and better local distribution.
The PNG government and its electrification partners (Australia, Japan, New Zealand and the United States) are working together to connect 70% of PNG’s population by 2030. Other projects, such as the development of economic, will help solve infrastructure problems. New highways and roads will help improve local distribution, but other issues directly affecting manufacturing have been identified, including a unstable regulatory environment.
“We see a lot of problems. Regular reports where, overnight, menstruation [change] and we see the imposition of tariffs that didn’t exist before and essentially become a tax,” Warren Mainey, managing director of Goodman Fielder in PNG, told the forum. “There is no reason to apply a tariff if there is no local manufacture [industry] which it is actually supposed to support.
Mainey, who also identifies the lack of qualified personnel as an ongoing problem for the manufacturing industry, says it makes sense to train local people.
“We don’t want to import expatriates to do this job. We want to invest in the local population. We want to call on experts to be relays and trainers, but we don’t see this as a long-term solution. The long-term solution is to develop local talent.