Papua New Guinea Introduces 10-Year Tax Break for Special Economic Zones
Papua New Guinea's International Trade and Investment Minister Richard Maru has announced a new 10-year tax break for all special economic zones (SEZs) in the country, aiming to spur investment. Maru made this statement during the groundbreaking ceremony for the K2.2 billion Sea Park Development Project, held on Thursday opposite the Apec Haus in Port Moresby.
Maru emphasized the need for investor partnerships to support the Sea Park Development Project, which has phases two and three yet to be completed. He called upon superannuation funds, including the National Superannuation Fund and Nambawan Super Limited, landowner companies, and local investors to collaborate on the project.
“The Sea Park Development Project is a significant K2.2 billion investment, encompassing the development of Azure Residences, Era Kone Hotel and Walk (phase 1.5), Era Kone Residences (phase two), and the Fountain (phase three),” Maru said.
Maru revealed that he had requested the Sea Park Development Project to submit a proposal to the Cabinet for consideration as a Special Economic Zone. This designation would allow the project to benefit from the SEZ incentive package, which includes the proposed 10-year tax break.
“Our primary objective is to attract investment, as it will create jobs and opportunities,” Maru explained. He projected that the economy could grow between four and five percent this year, with potential for six percent annual growth over the next 10 to 15 years if key mining and other projects are secured.
Maru expressed optimism about the country’s economic future despite current challenges. “We are introducing incentives for SEZs for the first time, a strategic move to compete globally for investment dollars,” he stated.
He commended the investors involved in the Sea Park project, noting the high returns on real estate in the country and expressing confidence that all apartments in Azure Residences will be sold before construction completion.
Additionally, Maru suggested that the developers consider including a hotel in their phase two plans near the Apec Haus, a prominent site for international conferences.
The K2.2 billion investment will benefit from a 10-year tax holiday and duty-free importation of construction materials, similar to the incentives offered to the Paga Hill SEZ, according to Maru.
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