Papua New Guinea (PNG), located in the southwestern Pacific Ocean, lies just north of Australia. This strategic proximity enhances its importance for regional trade and security. With a population of over 9 million, PNG's rich natural resources, particularly in minerals and oil, present significant economic opportunities.
However, political instability hinders economic freedom and development. Recent leadership changes have sparked debates about governance and policy direction, affecting investor confidence and the overall economic climate.
Currently, Papua New Guinea is ranked 148th1 in The Heritage Foundation's Index of Economic Freedom.
Source1: Data as of October 9, 2024.
The Port Moresby Stock Exchange (PNGX)
The Port Moresby Stock Exchange (PNGX) is Papua New Guinea's primary stock market. While relatively small in comparison to global exchanges, it plays a key role in the country's financial sector.
The PNGX includes a mix of local and foreign companies, with 11 currently listed, primarily from the mining, energy, and financial sectors. While most are considered local, some are attributed to their respective home countries.
Current Components of MVTGLE
MarketVector’s approach includes Papua New Guinea equities in the MarketVectorTM Total Global Equity Index (MVTGLE). BSP Financial Group (BSP) and Kina Securities (KSL) are included in the MVTGLE Index. MVTGLE's selection reflects MarketVector's ability to effectively identify strong local companies while meeting liquidity criteria.
BSP Financial Group (formerly Bank of South Pacific)
BSP Financial Group (formerly Bank of South Pacific) is a USD 2 billion company and one of the largest financial institutions in Papua New Guinea and the South Pacific, offering a wide range of banking services. Its size and market capitalization makes it significantly larger than most other PNG companies, reinforcing its dominant presence in the region’s financial sector.
Kina Securities Limited (KSL)
Similarly, Kina Securities Limited (KSL) is a leading financial services provider in Papua New Guinea, also listed on both the Port Moresby Stock Exchange (PNGX) and the Australian Securities Exchange (ASX). These dual listings enable both BSP Financial Group (BSP) and Kina Securities Limited (KSL) to attract a broader range of investors from the wider region, increasing their liquidity.
Since the beginning of 2022, BSP has delivered a strong performance of 39.5%, while KSL has risen by 15.5%, both outperforming indices like the S&P/ASX 200 Financials Index, which gained only 12.1% over the same period as per the above chart.
Source: S&P. Data as of October 1, 2024.
By analyzing prominent local equities in Papua New Guinea, the MarketVectorTM Total Global Equity Index provides a unique view of the Papua New Guinea market, highlighting distinct investment opportunities.
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Author: The MarketVector Team.
For informational and advertising purposes only. The views and opinions expressed are those of the authors but not necessarily those of MarketVector Indexes GmbH. Opinions are current as of the publication date and are subject to change with market conditions. Certain statements contained herein may constitute projections, forecasts, and other forward-looking statements, that do not reflect actual results. It is not possible to invest directly in an index. Exposure to an asset class represented by an index is available through investable instruments based on that index. MarketVector Indexes GmbH does not sponsor, endorse, sell, promote, or manage any investment fund or other investment vehicle that is offered by third parties and that seeks to provide an investment return based on the performance of any index. The inclusion of a security within an index is not a recommendation by MarketVector Indexes GmbH to buy, sell, or hold such security, nor is it considered to be investment advice.