Papua New Guinea : Pilot Border Trade and Investment Development Project

Sovereign Project | 42135-013

ADB is helping Papua New Guinea (PNG) improve its border facilities with neighboring Indonesian province, Papua. The project will remove the infrastructure bottlenecks between West Sepik province in PNG and Papua province, and help develop policies and institutions conducive to private sector investment. It will also provide business skills training and implement a social development program.

Project Details

  • Project Officer
    Villareal, Maria Theresa J.
    Pacific Department
    Request for information
  • Country/Economy
    Papua New Guinea
  • Modality
  • Sector
    • Industry and trade
Project Name Pilot Border Trade and Investment Development Project
Project Number 42135-013
Country / Economy Papua New Guinea
Project Status Closed
Project Type / Modality of Assistance Loan
Technical Assistance
Source of Funding / Amount
Loan 2591-PNG: Pilot Border Trade and Investment Development Project
Asian Development Fund US$ 25.00 million
TA 7393-PNG: Trade and Investment Institutional Strengthening
Technical Assistance Special Fund US$ 900,000.00
Strategic Agendas Inclusive economic growth
Regional integration
Drivers of Change Gender Equity and Mainstreaming
Governance and capacity development
Sector / Subsector

Industry and trade / Trade and services

Gender Equity and Mainstreaming Some gender elements
Description The Project will remove the infrastructure bottleneck along the northern transport corridor connecting West Sepik Province (WSP) of Papua New Guinea and Papua Province of Indonesia, and improve the investment environment in WSP to enable WSP to capture trade opportunities for development. It will finance (i) the border facilitites at Wutung, (ii) consulting services for project implementation and construction supervision, (iii) capacity development, and (iv) a social development program including HIV/AIDS prevention.
Project Rationale and Linkage to Country/Regional Strategy WSP is one of the poorest provinces in PNG in terms of both economic and social development. However, it has potential to develop itself and drive the development of PNG's northern coastal region if it can capture the opportunities offered by Asia, particularly the neighboring Papua Province of Indonesia, which provides 25%-40% cheaper products and services and is in demand of PNG products.
Impact West Sepik Province (WSP) developed into a dynamic growth centre.
Project Outcome
Description of Outcome The outcome of the Project will be the improved business environment in WSP.
Progress Toward Outcome

New Border administration office complex and staff housing infrastructure completed in Oct 2015.

To promote the idea of a "One-Stop-Shop" for trade, investment and border processing, senior officals from selected border management agencies undertook a study tour in November 2015 to land border crossings of four Great Mekong Sub-region countries namely; Cambodia, Vietnam, Lao PR and Thailand. The team met and discussed with similar border agencies of the four countries.

The EA continues to support capacity development and institutional building of its staff and the WSP Administration staff through skills enhancement training and hands-on training by its consultants engaged under the Project.

PNRM advised the EA (March 2018) and the Government (June 2018) of Project Loan closing date of 30 June 2018.

Implementation Progress
Description of Project Outputs The Project will produce the following outputs: (i) border facilities including customs, immigration, and quarantine facilities; resident housing, and markets; (ii) Investment policy legislation for WSP approved and made effective;(iii) Telecommunication strategy for WSP developed and approved by the Government; (iv) Border Development Authority (BDA) office in Vanimo becoming a one-stop service office for promoting trade investment, and tourism for WSP;(v) Human capital base in the areas of trade and investment promotion, business entrepreneurship and administration, information technology, and Indonesian language proficiency broadened and; (vi) Human development in terms of health and education improved in five border villages
Status of Implementation Progress (Outputs, Activities, and Issues)

(i) New Border Administration office complexes and 37 staff houses completed by October 2015.

(ii) The Investment Policy Advisor submitted the final Mid-Term Report to DCI and BDA in December 2012.

(iii) A telecommunication advisor submitted his final Study for Telecommunication Strategy for WSP to BDA and DCI in June 2011. Report recommendations presented to the relevant government agencies including the Project Steering Committee.

(iv) BDA established the provincial management office at Vanimo, WSP Provincial Administration with a Field Project Manager. PMO implementing the capacity development and Social Development Program (SDP).

(v) Under the Capacity Development Component, BDA has trained 192 locals from the five impacted villages on various entrepreneurial skills development training with (57 female). ADB approved BDA's 2017 training plan. Procurement of Institution to deliver Human Resource Management Course and Information Technology and Business Studies courses is completed. Contracts to be signed and courses will began early Q2. Procurement for Consultants/Institutions for the other training courses is in progress.

(vi) BDA, with the support of financial consultant, has developed Modified Conditional Cash Transfers (MCCT) guidelines to implement the Social Development Program. ADB approved these guidelines in July 2011. Implementation of the following five interventions under the SDP is in Progress. BDA revised the implementation process for several interventions to make them more community responsive.

(1) Power Connection for Wutung Village Household: Original scope of intervention was to supply and install MSKs. However, BDA found that all existing lines needed upgrading before private lines could be connected to the MSKs. To date, all 145 households have been connected to electricity

(2) Sanitation: The project will construct shared septic tanks and toilets to improve the environment and people's health. BDA purchased and transported the construction materials to Wutung. 8 blocks comprising 4 toilets and a shower are constructed. BDA is working with the LOs to complete construction of the remaining blocks. Through the LOs request, BDA is improving the water supply network which will supply water to the nearby villages and also the new border complex and housing areas. (3) Provision of School Fee Subsidy to at-risk children: Under this intervention, BDA provides financial assistance to at-risk children to encourage them to attend school up to grade 8. BDA has made payments to 488 at-risk children since March 2012. (4) Financial assistance to pregnant women for regular check-ups: Under this the project will assist pregnant mothers to go for medical check-ups. BDA has made payments to 22 pregnant mothers since March 2012. Due to the traveling distance and associated problems, the community has agreed with BDA to renovate existing aid post in the village to provide clinical facilities for the pregnant mothers and also the whole community. The design and scoping of the Aipost was completed in consultation with the health authorities. BDA to commence construction after confirming contract arrangements and land issues with LOs.

Geographical Location West Sepik Province, Wutung
Safeguard Categories
Environment B
Involuntary Resettlement C
Indigenous Peoples B
Summary of Environmental and Social Aspects
Environmental Aspects No major issue identified.
Involuntary Resettlement The project will not cause loss of housing, strips of land, crops, trees or other fixed assets. Consultation with stakeholders ongoing.
Indigenous Peoples No major issue identified.
Stakeholder Communication, Participation, and Consultation
During Project Design Extensive consultations with the relevant government agencies, provincial administration and project beneficiaries and potential affected parties have been carried out during project designs under project preparatory technical assistance.
During Project Implementation Development of the investment legislation and telecommunication strategy for WSP will require further consultations with PNG national and provincial government, Papua provincial government of Indonesia, business communities on both sides, and donor agencies. Capacity building will also require stakeholder consultation and participation to (i) select training programs, (ii) select training institutes, and (iii) define candidate selection criteria.
Business Opportunities
Consulting Services International and national consulting services will be required for (i) support to BDA and the PMO in the area of contract management, investment and tourism promotion, capacity development, and socioeconomic monitoring; (ii) construction supervision and environment monitoring; and (iii) HIV/AIDS prevention. The Project will fund a total of 350 person-months of consulting services (128 international; 222 national).
Procurement Civil works will be divided into two packages and will follow international competitive bidding (ICB) single-stage, one-envelope procedures, as the cost estimates for both contracts exceed $3 million-the ICB threshold for PNG. Equipment is grouped into eight packages. ICB will be followed for contracts estimated above $500,000. Contracts below $100,000 will following shopping procedures. National competitive bidding will be used for contracts between $100,000 and $500,000.
Responsible ADB Officer Villareal, Maria Theresa J.
Responsible ADB Department Pacific Department
Responsible ADB Division Papua New Guinea Resident Mission
Executing Agencies
Border Development Authority
Somare Crescent-NDB Building
PO Box 216, WAIGANI 131
National Capital Dist., Papua New Guinea
Concept Clearance 23 Jul 2009
Fact Finding 13 May 2009 to 29 May 2009
MRM 17 Aug 2009
Approval 27 Nov 2009
Last Review Mission -
Last PDS Update 28 Sep 2018

Loan 2591-PNG

Approval Signing Date Effectivity Date Closing
Original Revised Actual
27 Nov 2009 28 Jan 2010 26 Mar 2010 30 Jun 2018 - 19 Jun 2020
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 25.00 Cumulative Contract Awards
ADB 25.00 17 Jun 2022 21.70 0.00 100%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 17 Jun 2022 21.70 0.00 100%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating - Satisfactory Satisfactory Satisfactory - Satisfactory

TA 7393-PNG

Approval Signing Date Effectivity Date Closing
Original Revised Actual
27 Nov 2009 04 Jan 2010 04 Jan 2010 31 Dec 2014 31 Dec 2015 18 May 2016
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
900,000.00 0.00 160,000.00 0.00 0.00 0.00 1,060,000.00 17 Jun 2022 862,623.62
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating - Satisfactory Satisfactory Satisfactory - Satisfactory

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

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Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

Evaluation Documents See also: Independent Evaluation

Title Document Type Document Date
Papua New Guinea: Pilot Border Trade and Investment Development Project Validations of Project Completion Reports Aug 2021

Related Publications

None currently available.

The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

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No tenders for this project were found.

Contracts Awarded

Contract Title Approval Number Contract Date Contractor | Address Executing Agency Total Contract Amount (US$) Contract Amount Financed by ADB (US$)
Wutung Rural Electrification Project Labour, Tools and Equipment Supply Contract Loan 2591 27 Feb 2017 Certway Power Ltd. | P.O Box 5010, Boroko Ncd Papua New Guinea Border Development Authority 102,375.01 102,635.00

Procurement Plan

Title Document Type Document Date
Pilot Border Trade and Investment Development Project Procurement Plans Nov 2009