Photo: PM Marape in Parliament
Prime Minister Hon. James Marape has welcomed the Investment Promotion (Amendment) Bill 2022, unanimously passed by Parliament recently (January 11, 2023), which encourages the growth of Papua New Guinea-owned small-to-medium enterprises (SMEs) while at the same time attracting foreign direct investment (FDI).
PM Marape also welcomed passage of the accompanying Associations Incorporation Bill 2022, which will ensure better governance and accountability, especially among rural people who form associations to benefit their communities.
Both bills were passed 91-0 by Parliament after introduction by Commerce and Industry Minister Hon. Henry Amuli.
The Investment Promotion (Amendment) Bill 2022 is a change from the Foreign Investment Regulatory Authority (FIRA) Bill, tabled by the previous Government, in response to concerns that SMEs were facing unfair competition by foreign businesses. The FIRA Bill went too far in restricting business activities and was damaging PNG’s reputation as an attractive destination for foreign investors.
After in-depth consultation with the public and the business community, the Government accepted a balanced policy proposal put forth by the Investment Promotion Authority (IPA), which addresses SME concerns while providing investors with confidence.
Key changes are:
- Changing the foreign certification system to process applications quicker, and automatically rejecting applications for reserved activities to support SMEs;
- Reviewing the Reserved Activities List at least every three years;
- Introducing more reporting obligations on foreign investors, and providing powers to cancel certification where key business laws are breached;
- Improving IPA’s enforcement and compliance, and making better allowances for cross-agency enforcement;
- Creating a dedicated Registrar of Foreign Investment to oversee the system with powers to speed up unwanted incoming investment, automatically deny unwanted investment, and enforce compliance.
PM Marape said the new law was the culmination of work started by his Government in 2019 after he became Prime Minister.
“As we took office, our focus was on taking back the country from wrong hands, and one major focus was on business and SMEs,” he said.
“We made a commitment to empower our people to be engaged in businesses – a key focus which differentiates our Government from past governments.
“In the 2021 Budget, 20222 Budget and now the 2023 Budget, we have placed more support and funding to ensure SMEs start moving.
“We have also put in money this year to unlock land for people to settle on and do business, both big and small.
“This bill is a first step towards clearly segregating and ringfencing businesses that PNG citizens can participate in.”
