26/04/2026
*Current Situation of SMEs in PNG - 2026*
Based on latest data from April 2026, here’s where things stand:
*1. The Big Picture: Growth but Headwinds*
*Economic outlook is cautiously optimistic*
- PNG GDP expected to grow *4.0% in 2026*, non-resource economy *4.5%*
- 72% of CEOs expect profits to exceed 2025 levels
- 72% of CEOs forecast increased investment in 2026, with 52% planning a “substantial” increase 4fbc55d18472
*But risks remain*
- Slower global growth in Japan & China could hit commodity exports
- Commodity price volatility threatens export revenue & forex reserves
- Political/social instability + climate events are domestic risks
- Inflation predicted at *4.5% for 2026* 37ee55d1
*2. SME Stats & Government Targets*
*Where SMEs are now*
- *49,900 formal SMEs* in PNG
- *90% male-owned*
- Contribute only *6% to GDP* currently
- Concentrated in wholesale/retail, agriculture, tourism, fisheries
- Only *0.7% of SME output is exported* e96e
*Government’s 2030 ambition*
- Grow SMEs from 49,900 → *500,000 by 2030*
- Create *2 million new jobs*
- Lift SME GDP contribution from 6% → *50%*
- Reduce unemployment from 84.1% → *49%*
- Cut unbanked population from 85.6% → *40%* e96eeaa4
*3. Key Challenges for SMEs*
*Top business constraints are shifting*
1. *Utilities & infrastructure* - Power disruptions still major issue. PNG Power gets K226.6M in 2026 budget
2. *Security* - 2nd biggest impediment in 2025. Budget adds 34% more for police ops in 2026
3. *Foreign exchange* - Used to be #1, now fallen to 12th. Still a constraint but easing
4. *Access to finance* - National Development Bank cut SME rates to *6.5%*, down from 20% in 2012 4fbc0d60f37e8472eaa4
*Other pain points:*
- Payment defaults rising for smaller employers
- 4% increase in Nasfund unemployment benefit payments last year 220f
*4. New Support & Opportunities*
*International partnerships*
- *PNG-India MoU signed April 23, 2026* for MSME cooperation: tech transfer, skills training, startup ecosystems, cross-border trade 712e
*Infrastructure investment*
- K9.1B spent on roads/ports/airports 2018-2024, plus K2.03M in 2026
- CADIP Phase 2 upgrading airports gets K87M in 2026
- Infrastructure tax credit increased from 2% → 3% to boost private partnerships f37e
*Major projects driving SME work*
- Porgera gold mine restart creating 3,000 jobs
- Papua LNG FID expected 2025, early works 2024- should boost ancillary SME activity b637220f
*Bottom line for SMEs right now:*
Business confidence is above average for the first time since 2016. FX is less of a headache, but power, security, and infrastructure are the new battles. Government is pushing hard on SME growth with finance, infrastructure, and international deals, but the gap between 49,900 SMEs now and 500,000 by 2030 is huge. 6921
Soaurce LAE SME Consultancy Survey
