PNGX welcomes market growth targets, corporate debt market and listed property trusts to develop local capital markets

By: PNG Business News July 21, 2023

PNGX Group, operator of Papua New Guinea’s national stock exchange, has welcomed the statement by Minister for International Trade and Investment, Hon Richard Maru MP, to seek to increase the size of the Papua New Guinean capital market to over 500 billion kina in the next 4 years.

Minister Maru outlined the objective when announcing the new PNGX Corporate Debt Market. The current total market capitalisation is 135 billion kina. The target represents an increase of 350%.

“We would like to thank the Minister for his final approval of the new corporate debt market” said PNGX Group Chairman, Mr David Lawrence. “We would also like to thank the International Finance Corporation (IFC), the ADB Private Sector Development Initiative (PSDI) and the Securities Commission of PNG for their work and support” he said.

The Minister also expressed support for the development of major listed real estate investment trusts (REITs). REITs have the potential to provide opportunities for significant mobilisation of capital and a multiplier effect throughout the economy, including through SMEs in the property development supply chain. PNGX has been working with the Property Developers Association to develop the REIT market.

To support SMEs having better access to capital, the Minister foreshadowed the introduction of a new “small offers” regime to allow SMEs to more easily and cost effectively raise small amounts of capital to fund their growth. PNGX is working on the development of a suitable market structure to support the “small offers” regime.

“The Minister’s comprehensive package of announcements could provide a significant stimulus for the local market. It could deliver the increased diversity of investment opportunities which large and small investors have been seeking.”

The Minister’s target of 500 billion kina market capitalisation within the next 4 years is further supported by the Government’s recently released Medium Term Development Plan which targets 10% annual growth in the number of Papua New Guinean companies listed on PNGX, 10% annual growth in the number of domestic retail investment participants in the market and an increase in the proportion of the PNG population investing in the domestic capital markets.

PNGX welcomes these growth opportunities and expresses its readiness to work closely with all market participants and stakeholders. Our goal is to facilitate the growth emphasized by the Minister and contribute to the overall development of the PNG capital market.

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