Brewer says things are looking up
Being a manufacturer in Papua New Guinea means managing cycles, according to Stan Joyce, managing director of SP Brewery, PNG’s oldest brewer. He is expecting economic developments to start turning in the sector’s favour.
“Things are generally in a better place for the first quarter of 2019 than they were for most of 2018, and 2017,” he says. “The re-set in the market – the adjustment to the availability of foreign exchange, the adjustment to weaker consumer demand – has, in the main, started to wash itself out. Most people are now preparing for a better future.”
In an effort to partially reduce its need for foreign exchange to purchase internationally, SP Brewery has started producing its own starch using cassava crops. It has also established a flour mill in Lae.
Joyce describes the move as small steps only, but he believes
it is sound long-term strategic positioning. “It gives us a better sustainable footprint. In the longer run, the things that we have seen happen in the last four or five years will happen again in four or five years’ time. That cycle just occurs.”
Joyce believes protection of manufacturing industries using tariffs can be positive, provided it is implemented on a case-bycase basis. “There is an argument that can be made for these things. If you have the right safeguards and the right incentives given, with the right obligations from all the stakeholders, it can be a good thing.”
Joyce says his company has investors who take a long-term view of the economy and are prepared to “put away some for a rainy day”. He notes that SP Brewery has been in PNG since 1952.
“We continue to have a very positive view of what the potential is, and the future of the country. We look forward to working with those in government and those people who are interested in developing the sector.”
– DAVID JAMES
Things are generally in a better place for the first quarter of 2019.