In September, Papua New Guinea (PNG) celebrated its 50th anniversary of independence. PNG and Australia are only a few kilometres apart at the closest point, and have just become even closer as partners when we elevated our relationship to an Alliance, with the signing of the Papua New Guinea – Australia Mutual Defence Treaty.
PNG has also been in the news lately with a deal funding a PNG-based rugby league (NRL) team. Australia is providing $600 million over 10 years to support a new team – which has just revealed it will be known as the Chiefs – set to join the competition in 2028.
With nearly 12 million people, PNG is the largest and most populous South Pacific nation. Australia is PNG’s biggest trade partner, with bilateral trade of over $5 billion. Our business relationships with this neighbour to our north are dynamic, multi-faceted and comprehensive.
However, exporters should not let the close geographical proximity lull them into taking PNG businesses for granted when negotiating deals. If you want to establish long-term connections in PNG, it’s important to adopt the relationship-style model of doing business. This is typical in Pacific cultures.
Business tips
Business might be done differently than what you are used to. Be open to learning new ways.
- Face-to-face communication is preferred over email.
- Business success relies on establishing strong relationships with trust over time.
- WhatsApp is commonly used for communication.
- Always have plenty of business cards and treat other people’s cards with respect.
- Use similar forms of address as you would in Australia.
- Consider scheduling regular meetings for updates and to maintain good business relationships.
- It’s not common practice to give gifts in business dealings.
Our relationship with PNG is governed by formalities like the Agreement on Trade and Commercial Relations (PATCRA II), which provides preferential duty rates for PNG goods in Australia. Beyond trade, Australia provides substantial economic support and developmental assistance to PNG, fostering a deep, long-term relationship.
Australia’s exports to Papua New Guinea totalled US$1.66 billion during 2024, according to the United Nations COMTRADE database on international trade. Our primary exports are meat, wheat, civil engineering equipment, and various manufactured goods and processed foods. Other significant exports are dairy products, fertilisers, pharmaceutical products, and ships.
According to the same UN database, about 98% of our imports from PNG are made up of gold and other precious metals, pearls, precious stones, and coins, amounting to US$2.59B in 2024. At a distant second was coffee, tea, mate and spices, amounting to US$38.10M.
China has already significantly shored up trade with Pacific Island nations in recent years, and is now trying to establish diplomatic and security beachheads across the region, including PNG. Australia and its Western allies, including the United States, have been attempting to counter these efforts.
The way to do business is different in each country. Finding and working closely with the right partner is the key to success in the PNG market. Whether dealing with an agent, distributor, wholesaler, retailer or end user, do your due diligence on potential options.
At the centre of this relationship is understanding cultural nuances and the intersection of communities, clans, families, business, and faith. We suggest you visit PNG first, to meet potential partners and develop lasting connections.
Doing business in PNG demands attention to detail—avoid the common traps by talking to Colless Young when you are ready to start shipping. Ask us how you can benefit from the commercial arrangements that exist between the two countries. Talk to Andrew, Tel: +61 7 3890 0800, email enq@collessyoung.com.au
