When Elites Leave and Foreigners Stay: A Tale of Two Economies in PNG

Commentary by George Lemako

​Abandoned by Their Own: How Foreigners Fill PNG’s Local Business Void

One of the most overlooked realities in Papua New Guinea’s economic landscape is the silent exit of local elites from communities that once nurtured them. For many educated Papua New Guineans, a university degree and a job in Port Moresby or overseas represent escape routes from poverty and the difficult conditions in settlements and rural areas. Once success is achieved, the first instinct is to distance themselves from the "traditional life" and embrace a lifestyle surrounded by city lights, modern comforts, and social prestige.

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This shift has left a massive development vacuum in underprivileged areas. While locals turn away from their home settlements and villages, foreign entrepreneurs—mainly from Asia and South Asia—have seized the opportunity. In places where no local wants to do business, a Chinese or Indian trader builds a store, forms relationships with community members, and establishes a sustainable commercial presence. These foreigners are not necessarily highly educated, but they bring with them resilience, financial discipline, and a deep understanding of relationship-building in harsh environments.

Unlike many PNG elites who isolate themselves behind gated communities and rarely return home except for funerals or brief holiday visits, foreign traders embed themselves directly into the communities. They build relationships with locals, participate in village events, and offer services where government support is absent. This grassroots approach has earned them not just profit, but also loyalty and influence. While elites showcase wealth at cultural events without tangible impact, foreigners provide daily necessities and employment—an exchange far more valuable to struggling populations.

Foreigners also succeed where local businesses fail due to cultural and social pressures. PNG’s educated classes often find themselves burdened by clan obligations, “save pes,” and demands for credit from extended family. These cultural factors discourage investment and complicate business growth. In contrast, foreigners operate without these expectations. Locals feel more comfortable buying from a foreigner’s shop, seeing them as neutral ground, rather than dealing with the complex dynamics of buying from a relative or tribesman.

Furthermore, while many local professionals struggle with personal budgeting, foreigners—despite modest education—show remarkable financial discipline. They keep costs low, reinvest profits, and build thriving businesses in the most remote and neglected areas. Their willingness to work in places without roads, functional clinics, or reliable law enforcement has turned them into de facto service providers. In some instances, they even step in to support police stations, schools, and churches—filling roles that government should play.

The divide has grown so wide that villagers now place more trust in foreign shop owners than in their own degree-holding relatives. These traders attend haus krais, contribute to bride price ceremonies, and assist in compensation payments, embedding themselves culturally as well as economically. Their presence, once seen as temporary or opportunistic, is now deeply entrenched. What should have been the role of PNG’s educated elite—guiding community growth and economic progress—has been surrendered to outsiders.

This is not merely a case of foreign commercial invasion; it is a reflection of national neglect. PNG’s elite have, intentionally or not, abandoned the frontlines of grassroots development. In their place, foreigners have built bridges—commercial, cultural, and social. The question now is whether the country’s future will continue to be shaped by those who stayed behind, or by those who came from outside and never left.

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