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Final <strong>Report</strong>
RoO Derogation under the PACP-IEPA
3.2.3 Potential future investments
In addition to the confirmed investments or investments likely to go ahead with some degree of
certainty described in Section 3.2.2, there are other possible investments that have been informally
proposed, have been the subject of enquiries, or may have prompted site visits to PNG to explore
possibilities. It is necessary to evaluate these as part of estimating demand for globally-sourced fish
in PNG in the future.
Most uncertainty for future investment relates to the proposed Pacific Marine Industrial Zone (PMIZ)
development at Vidar, Madang Province. It is useful to recount the history of this initiative and its
current status.
Establishment of the Pacific Marine Industrial Zone was mooted in the late 1990s/early 2000s to
increase onshore processing activity (including, but not exclusive to the processing of fish products)
in a central location to fishing grounds, to build economies of scale through the development of an
‘economic cluster’/critical mass and, as a result, lower key operating costs (e.g. utilities, freight). An
area of 215 ha of freehold land adjacent to the present RD Fishing port was made available by the
freehold owner (RD) and was acquired by PNG Government. The concept was approved for
development in 2005, with the offer of a concessional soft loan from the China Exim Bank 40 to
underwrite the development. The project was to proceed in two phases: 41
• Phase 1 - involving land acquisition, construction of major infrastructure (e.g. wharves,
roads, utilities etc.), at a value of US$ 95 million, with US$ 74 million to be funded by Exim
Bank and the balance by the Government of PNG.
• Phase 2 - involving development of public and commercial amenities (US$ 65 million).
A National Management Committee was established to serve as the project’s governing board,
comprised of DCI and NFA (who have been the major driving government players), as well as
representation by other GoPNG agencies and the private sector. It was also intended that PMIZ
would be incorporated as a Special Economic Zone (SEZ), established under an SEZ Bill, which was
prepared with the assistance of IFC and to be approved before the end of 2011. 42 A feasibility study
was commissioned and an Environmental Impact Assessment submitted in late 2009/early 2010. 43
In March 2011, approval in principle for the project was granted by the Minister for Environment
and Conservation, at the time. However, with the change in Government in mid-2011, an immediate
review of the PMIZ project was directed for completion by December 2011. Indications have been
given of support in principle for the project by the new Government, with an expectation that the
implementation schedule of the PMIZ should not be affected.
Project construction is yet to commence, in part because the GoPNG contribution to Phase 1 has yet
to be provided and is unlikely to happen until early 2012, at the earliest. Until such time as GoPNG’s
contribution is made, Chinese load funds cannot be released. Phase 1 construction time (involving a
44
contracted Chinese firm as a condition of the Chinese Exim Bank loan), is estimated at three years.
40 CSYIC, undated.
41 DCI PMIZ Coordinator, pers. comm., September 2011.
42 International Finance Corporation 2011; refer for a summary of IFC’s recommendations regarding SEZs in
PNG.
43 CSYIC, undated.
44 DCI PMIZ Coordinator, pers. comm., September 2011.
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