Papua new guinea Country Commercial Guide
Learn about the market conditions, opportunities, regulations, and business conditions in papua new guinea, prepared by at U.S. Embassies worldwide by Commerce Department, State Department and other U.S. agencies’ professionals
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Selling to the Public Sector
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Selling to the Government

According to PNG’s Investment Promotion Authority, Communications, Value Chain, and Transportation sectors are potential areas for investment.  These areas heavily involve infrastructure financing.  In PNG, this is mostly arranged through Exim banks.

PNG’s procurement requirements are handled by the Department of Finance, which works in close consultation with the country’s National Procurement Commission (former Central Supplies & Tenders Board).

PNG’s procurement law applies to all public and statutory bodies with exceptions for state-owned enterprises (SOEs).  SOEs are exempted mainly due to the investment responsibilities that they are required to perform unlike that of public or statutory bodies.  However, the procurement law applies to any procurement requirement sponsored by the national budget and may include SOEs.

For procurement arrangements under international agreements, the agreement supersedes procurement law.  This extends to procurements that involve co-funding, where the law only applies to funding portions involving the Government of Papua New Guinea.

The current national procurement law reserves government contracts valued up to US$3.1 million only to national companies and Papua New Guineans.  Contracts ranging between US$3.1 million to US$9.2 million, while open to partnerships, will require fifty percent of the value of the procurement to be undertaken only by local companies. However, these procurement restrictions reach a level playing field for contracts worth US$9.2 million or more, opening project tenders to service providers, both national and non-national companies.  However, the Marape-Rosso government is in the process of amending the procurement act to increase the limit to US$32.53 million.

Amid the opportunities and established legal framework, there is still growing concern regarding the level of transparency and fairness in the process of awarding contracts in PNG.

The central bureaucracy is increasingly politicized, which has eroded the capacity of government departments while allowing nepotism and cronyism to thrive in parts of the public service.  Observers believe that rampant political interference in the appointment process of the executive management and boards of state-owned enterprises (SOEs) have resulted in most SOEs suffering from poor management.  The awarding process for government procurement contracts continues to lack competitive bidding processes due to excessive political influence.

In addition, the lack of proper consultation by the government on legislative and policy reforms has raised serious concerns over the independence and effectiveness of due process.

U.S. companies bidding on Government tenders may also qualify for U.S. Government advocacy.  A unit of the U.S. Commerce Department’s International Trade Administration, the Advocacy Center coordinates U.S. Government interagency advocacy efforts on behalf of U.S. exporters bidding on public sector contracts with international governments and government agencies.  The Advocacy Center works closely with our network of the U.S. Commercial Service worldwide and inter-agency partners to ensure that exporters of U.S. products and services have the best possible chance of winning government contracts.  Advocacy assistance can take many forms but often involves the U.S. Embassy or other U.S. Government agencies expressing support for the U.S. bidders directly to the foreign government.  Consult Advocacy for Foreign Government Contracts for additional information.     

Financing of Projects

According to PNG’s Investment Promotion Authority, communications, value chain, and transportation sectors as potential areas for investment.  These areas heavily involve infrastructure financing, and, in PNG, this is mostly arranged through Exim banks.

Multilateral Development Banks and Financing Government Sales

Price, payment terms, and financing can be a significant factor in winning a government contract.  Many governments finance public works projects through borrowing from the Multilateral Development Banks (MDB). A helpful guide for working with the MDBs is the Trade Finance Guide.  The U.S. Department of Commerce’s (USDOC) International Trade Administration (ITA) has a Foreign Commercial Service Officer stationed at each of the five different Multilateral Development Banks (MDBs): the African Development Bank; the Asian Development Bank; the European Bank for Reconstruction and Development; the Inter-American Development Bank; and the World Bank.

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Global Business Navigator Chatbot Beta

Welcome to the Global Business Navigator, an artificial intelligence (AI) Chatbot from the International Trade Administration (ITA). This tool, currently in beta version testing, is designed to provide general information on the exporting process and the resources available to assist new and experienced U.S. exporters. The Chatbot, developed using Microsoft’s Azure AI services, is trained on ITA’s export-related content and aims to quickly get users the information they need. The Chatbot is intended to make the benefits of exporting more accessible by understanding non-expert language, idiomatic expressions, and foreign languages.

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