All eyes on Sin­ga­pore

Why PNG busi­nesses are set­ting up in the Lion City

Paradise - - Contents -

Sin­ga­pore is be­ing taken se­ri­ously as a lo­ca­tion for Pa­pua New Guinean busi­nesses. Last year, fi­nance com­pany Moni Plus an­nounced a re­verse takeover by Jaya Hold­ings that would see it listed on the Sin­ga­pore Stock Ex­change (SGX). The aim was to di­ver­sify the com­pany’s share­holder base, ac­cord­ing to man­ag­ing di­rec­tor, David Kelso.

PNG’s big­gest bank, Bank South Pa­cific, has also looked at list­ing on the SGX, although those plans have been shelved. Dig­i­cel, PNG’s big­gest telco, re­lo­cated its re­gional head­quar­ters from Syd­ney to Sin­ga­pore.

Deloitte PNG man­ag­ing part­ner, Ben­jamin Lee, says that Sin­ga­pore plays a key role for com­pa­nies at­tempt­ing to ex­plore busi­ness op­por­tu­ni­ties out­side of PNG. He says it is also im­por­tant for trade com­ing in and out of the coun­try.

“Sin­ga­pore’s ge­o­graph­i­cal lo­ca­tion al­lows it to play an im­por­tant role in terms of ori­gin of im­ports to Pa­pua New Guinea and also exports from Pa­pua New Guinea,” Lee says.

Di­rec­tor of PNG Eco­nom­ics, Paul Flana­gan, says to ex­pect an in­crease in Sin­ga­por­ereg­is­tered com­pa­nies with PNG link­ages, as part of a glob­al­is­ing world.

“The key is­sue will be if Pa­pua New Guinea’s growth rate in such reg­is­tra­tions or link­ages is grow­ing faster or slower than other coun­tries.

“This would be a par­tial met­ric to judge the hy­po­thet­i­cal that Pa­pua New Guinea could be­come a hub be­tween Asia and the Pa­cific,” Flana­gan adds.

Sin­ga­pore’s free econ­omy, with one of the low­est lev­els of taxes, makes the coun­try an at­trac­tive op­tion for com­pa­nies set­ting up a base to in­vest in PNG, Lee says.

Sin­ga­pore has be­come a global hub for busi­nesses seek­ing to trade with mul­ti­ple coun­tries, in­clud­ing PNG, ac­cord­ing to West­pac PNG man­ag­ing di­rec­tor, Adrian Hughes.

“Sev­eral Sin­ga­porean busi­nesses have shown a keen in­ter­est in in­vest­ing in or start­ing new busi­nesses in Pa­pua New Guinea, and we’ve had many in­quiries from new en­trants try­ing to en­ter the Pa­pua New Guinean mar­ket,” Hughes says.

The in­creas­ing num­ber of Asian­head­quar­tered multi­na­tion­als open­ing op­er­a­tions in PNG shows in­ter­est in the re­gion and will as­sist in pro­vid­ing sus­tain­able eco­nomic growth for the coun­try.

“While Sin­ga­pore has been good for multi­na­tion­als en­ter­ing the Pa­pua New Guinean mar­ket, it has also been crit­i­cal for Pa­pua New Guinean busi­nesses of­fer­ing max­i­mum ex­po­sure through ac­cess to this global trad­ing hub,” Hughes ex­plains.

For­eign ex­change short­ages are a chal­lenge for busi­ness in PNG and could be a driver for com­pa­nies bas­ing them­selves in Sin­ga­pore, Flana­gan says.

The Sin­ga­pore sky­line ... PNG busi­nesses are be­ing at­tracted to the Lion City.

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