PNG Government and ADB's PSDI sign MoU to support PNG Securities Commission on capital market development
PORT MORESBY, PAPUA NEW GUINEA (20 July 2022)—The Securities Commission of Papua New Guinea (SCPNG) and the Asian Development Bank’s (ADB) Pacific Private Sector Development Initiative (PSDI) have signed a Memorandum of Understanding (MoU) to foster capital market development and improve inclusive access to finance for PNG businesses.
“This reform initiative is critically important not only for PNG’s finance sector, but also for the overall growth of the economy, given the role financial markets play in terms of mobilizing savings and investments, as well as enabling transmission of monetary policies of the government,” Bank of PNG Acting Governor and PNG Financial Services Council (FSC) Chair Benny Popoitai said. “On behalf of the Bank of PNG, Treasury, and SCPNG, who make up the FSC, I thank PSDI for their continuous technical support over the years, to which this MoU serves as an extension.”
“This partnership is important for SCPNG as it strives to increase the PNG finance sector’s contribution to economic and social development,” SCPNG Acting Executive Chair Robert Salmon-Minak said. “It builds on SCPNG’s foundational work on capital market development and capacity building in a way that is both strategic and pivotal for PNG. The MoU is the product of many months of engagement between PSDI, Treasury, and the Bank of PNG. SCPNG acknowledges their contributions and looks forward to the MoU’s implementation.”
Development of PNG’s capital market and the strengthening of SCPNG are key deliverables under the PNG Government’s Financial Sector Development Strategy (FSDS) 2018-2030, which is overseen by the FSC.
The MoU outlines the technical, operational, and policy cooperation that will take place between PSDI and SCPNG. Key work streams include strengthening SCPNG’s role as PNG’s capital market regulator through capacity-building measures, and developing a robust capital market strategy, including policy, legal, regulatory, and technology reforms to support a vibrant PNG capital market.
Mainstreaming the economic empowerment of women will be an important element of this work. PSDI-supported reforms are expected to enable the development of alternative capital raising platforms, which can create new opportunities for women and small- and medium-sized enterprises to access finance.
“The development of capital markets will improve inclusive access to business finance in PNG,” ADB Pacific Liaison and Coordination Office Regional Director Lotte Schou-Zibell said. “ADB is pleased to support the FSC and SCPNG in this important suite of work.”
This significant work program will take place over the next 2.5 years, and has been facilitated by the provision of $AU1.3 million in earmarked funding from the Australian Government.
“The Australian Government is pleased to support the development of the PNG capital market through this reform program,” Australian High Commissioner to PNG Jon Philp said. “Expanding investment opportunities in PNG will help spur economic growth, jobs, and prosperity.”
SCPNG is an independent statutory body corporate that regulates the capital market and its practices in PNG. SCPNG seeks to protect investors, maintain a fair, orderly, and efficient capital market, and mitigate inherent market risks.
PSDI is an ADB technical assistance program undertaken in partnership with the Governments of Australia and New Zealand. PSDI supports ADB's 14 Pacific developing member countries to improve the enabling environment for business and to achieve inclusive, private sector-led economic growth.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members—49 from the region.