Foreign investment drops by 45pc

By SHIRLEY MAULUDU
FOREIGN direct investment into the country dropped by about 45 per cent in the past two years, according to the Investment Promotion Authority (IPA). Managing director Clarence Hoot said interest in investment dropped from more than 1,000 in 2019 to around 300 in the first quarter of this year.  “Global FDI (foreign direct investment) outflow has drastically reduced by 45 to 50 per cent,” Hoot told the virtual Praivet Gavamani Konnekt 2 dialogue yesterday. “(It) means for us that foreign direct investments will have to be more than 10 times or 20 times than what we are currently doing. We have to relook at ourselves, what we have in place, what we want and where we want to be.” Hoot said from a regulator’s perspective in terms of foreign direct investment, “we have seen a reduction of 40 to 45 percent in terms of FDI interest coming to PNG”.  “In 2019, the total number of foreign direct investment documents that we received was 1,116. In 2020 that reduced to about 800. And in the first quarter of 2021, it is 300. From IPA perspective, that is a real concern.  “While we appreciate that it may be a direct result of the impacts of the Covid-19, I think we should look beyond the Covid-19. We also have to look at what we have in terms of domestic policies, laws and regulations,” Hoot said.  He also said there were indications that PNG had dropped in its ranking in relation to convenient places for doing business.  In 2018/2019, PNG’s ranking was about 108 over 190. In 2019/2020, it slipped 12 places to 120/190.