Papua New Guinea

With confidence in Papua New Guinea’s economy rising due to the prospects of gas and mining wealth, the country’s retail market is expected to see significant expansion in the next few years. Rising incomes and urbanisation suggest the retail and industry sector will gradually evolve away from its traditional focus on informal markets to new trends such as luxury goods and modern shopping malls and supermarkets.

Expectations that Papua New Guinea (PNG) will emerge as a major energy supplier for Asia’s growth leaders in the next decade have been heightened by reports of progress on two major liquefied natural gas (LNG) plants currently under development.

With a major project backed by the World Bank getting under way and a sizeable budget allocated by the government, Papua New Guinea’s state-run coffee industry has significant potential for expansion in 2012.

With the mining and agriculture sectors performing well and a major liquefied natural gas (LNG) export project nearing completion, Papua New Guinea (PNG) used 2011 to prepare for an expected resource-related boom over the coming years. Despite some political discord, the country took a number of progressive steps during the year, including the establishment of a sovereign wealth fund (SWF), which was seen as vital for the management of future revenues.

Glowing assessments of Papua New Guinea's economic outlook see natural resource wealth leading growth for this year, with positive implications for the country's broader development. However, external factors threaten to post challenges to a major liquefied natural gas (LNG) project.