Construction & Real Estate

Although Papua New Guinea’s construction sector contracted in 2014 after a four-year boom from the massive PNG liquefied natural gas project, industry growth is expected to pick up again in 2015. New petroleum revenues are set to support the government’s sizeable infrastructure investment programme, which is seeing major improvements to roads, ports and airports in preparation for the 2015 Pacific Games and the 2018 APEC summit. The business environment remains challenging for private contractors, particularly in terms of obtaining construction permits; however, a growing emphasis on public-private partnerships (PPPs) and rising foreign financing has improved the near-term outlook, and new efforts to supply affordable housing and expand home ownership will certainly underpin steady, long-term growth. Rising inflation, as recorded in the country’s consumer price index (CPI) housing category, saw property prices and rental rates spike between 2008 and 2013. This trend continued into 2014, suggesting that the property market is likely to remain on an upwards trajectory, reinforced by robust GDP growth and a growing urban population.

This chapter contains interviews with Marcelo Minc, Country Director, Asian Development Bank’s Papua New Guinea Resident Mission; and Andrew Potter, General Manager, Pacific Palms Property.