Papua New Guinea’s largest renewable primary resource is the forest, which covers three quarters of its land mass. The value of timber accounts for 3% of domestic exports. Export taxes are levied on unprocessed logs at rates up to 70%. The country’s overarching policy is for sustainable management of the natural forestry resources, which will play an important role in PNG’s socio-economic development.
The forests of PNG contribute significantly to employment creation (7,500 people or 4% of total employment), revenue generation for local landowners and the National Government, and development of infrastructure in the rural areas. The landowners benefit from the forest in the form of royalties and premiums, while the national government benefits through export taxation.
As the unique attributes of each species and market demands are fully investigated and understood, expanded onshore processing of wood products will create higher value added and will enhanced rewards for landowners, workers, and the community Quality control at all stages of processing chain will be essential to grow and maintain market share for round logs exports and the new onshore processed high value wood products.