New PNG MSME study updates a ground-breaking business dataset

Tebbutt Research has completed a new national study of micro, small and medium enterprises (MSMEs) and informal businesses in Papua New Guinea for the Australia Papua New Guinea Economic Partnership (APEP).

The Papua New Guinea Micro, Small and Medium Enterprises and Informal Sector Study – Detailed Findings Report is an important update to the 2014 PNG SME Baseline Survey, also conducted by Tebbutt Research. That earlier study became one of the most widely used empirical datasets on PNG’s SME sector, supporting research on business constraints, gender, ICT, corruption, internationalisation and SME policy priorities.

The new 2024 study gives PNG’s policy makers, development partners, financial institutions, researchers and business support organisations a fresh evidence base for understanding how the sector has changed — and where support is most needed.

Read the 2024 report

Project details
Client: Australia Papua New Guinea Economic Partnership (APEP)
Country: Papua New Guinea
Topic: MSMEs, informal businesses, business growth, access to finance, formalisation, GEDSI, climate change and business support needs
Output: Detailed findings report
Tebbutt role: Research design, quantitative survey implementation, qualitative depth interviews, analysis and reporting
Fieldwork: 21 provinces, 61 fieldwork locations
Sample: 1,309 formal MSMEs, 1,302 informal businesses and 41 qualitative depth interviews

A new evidence base for PNG’s small business sector

Small businesses are central to Papua New Guinea’s economy. They provide employment, supply goods and services, support household income, and create opportunities for growth outside the formal wage economy.

But the sector is complex. Formal MSMEs are only part of the picture. Informal businesses are also a major part of commercial life in PNG, but they are often less visible in administrative records and policy datasets.

The 2024 study was designed to capture both.

Tebbutt Research conducted quantitative interviews with more than 2,600 businesses across 21 provinces, covering formal MSMEs and informal businesses in urban, rural and remote locations. The study also included qualitative depth interviews with business owners and managers to better understand the stories behind the data.

Building on the 2014 SME Baseline Survey

The 2024 study builds on the ground-breaking SME Baseline Survey conducted by Tebbutt Research in 2014.

The 2014 study generated substantial interest because it provided a rare, detailed and nationally relevant dataset on PNG’s SME sector. It was not only useful for the original project. It became a foundation for independent analysis by researchers examining different aspects of small business development in PNG.

Research using the 2014 data has explored:

• How perceived obstacles to operation and expansion relate to enterprise performance
• Whether women face different barriers from men when participating in SMEs
• The use and impact of ICT on SMEs in PNG
• Barriers to internationalisation among Indigenous-owned MSMEs
• SME policy priority areas for Papua New Guinea
• The perceived impact of public sector corruption on MSME employment growth

That level of use demonstrates the value of high-quality survey data. When the underlying research is robust, it can support analysis across many policy questions.

What the 2024 study found

The 2024 study shows that PNG’s MSME sector remains dominated by micro-enterprises.

Among formal MSMEs surveyed, 67% were micro-enterprises, 27% were small enterprises and 6% were medium enterprises. Retail trade was the largest sector in the formal MSME sample, followed by hospitality, transport and motor vehicle-related businesses.

The report also highlights the scale and importance of informal business activity. Informal businesses are often smaller, less connected to formal support systems and more likely to be missed in conventional business datasets, yet they provide income and services across communities throughout PNG.

The study also shows a sector with ambition. Many businesses expected conditions to improve, and many reported plans to hire more staff. At the same time, businesses continued to face major obstacles, including access to finance, law and order, government processes, regulation, taxation, infrastructure and limited awareness of available business support.

Women, informality and business barriers

One important feature of the 2024 study is its attention to gender and inclusion.

Women were more strongly represented in the informal sector than in the formal MSME sector. This matters because support programmes that focus only on formal businesses may miss many women-led enterprises and smaller livelihood businesses.

The report also identifies barriers that affect women in business, including access to finance, business services, security concerns, discrimination, cultural obligations and the challenge of balancing business with family responsibilities.

These findings are important for organisations working on women’s economic empowerment, financial inclusion, business formalisation and inclusive private sector development.

Research across 21 provinces

Conducting a study of this scale in Papua New Guinea requires strong field systems and practical local knowledge.

Tebbutt Research conducted fieldwork across 21 provinces and 61 locations. The study used interviewer-administered CAPI surveys in English or Tok Pisin, depending on respondent preference. Fieldwork was conducted by PNG national interviewers and included formal MSMEs, informal businesses and qualitative depth interviews.

This kind of research requires more than a questionnaire. It involves sample design, field logistics, respondent screening, business district canvassing, interviewer training, field supervision, data quality checks, validation and careful analysis.

It is the type of work Tebbutt Research has been delivering in Papua New Guinea and across the Pacific for decades.

How the 2014 dataset was used

The 2014 SME Baseline Survey is an important part of this story because it shows what can happen when a business survey is designed and implemented well.

The dataset supported multiple papers on PNG’s SME sector, including studies of business performance, gender barriers, ICT use, corruption, internationalisation and policy priorities.

Briefly:

• Perceived obstacles and enterprise performance: examined how SME owners’ and managers’ reported constraints related to sales, employment expectations and perceived business performance.
• Gender barriers in SMEs: explored whether women-owned or women-managed SMEs faced different barriers from male-owned or male-managed firms.
• ICT use and impact: analysed how access to and use of ICT related to SME performance and growth.
• Internationalisation of Indigenous-owned MSMEs: examined barriers preventing Indigenous-owned MSMEs from exporting or engaging more fully in international markets.
• SME policy priority areas: used the survey evidence to identify priority areas for SME policy in PNG.
• Public sector corruption and employment growth: examined how perceived corruption related to employment growth among MSMEs.

We are happy that the dataset has supported serious analysis across different policy questions.

A new platform for future analysis

The 2024 MSME and Informal Sector Study now provides an updated platform for analysis.

Because it builds on the earlier SME baseline while also expanding attention to informal businesses, gender, climate change, disability inclusion and business support needs, the new study has the potential to inform a wide range of future work.

For policy makers, it provides evidence on the current state of PNG’s business sector.

For development partners, it helps identify where support may be needed.

For financial institutions and business service providers, it highlights gaps in awareness, access and demand.

For researchers, it creates a new empirical base for understanding how MSMEs and informal businesses are operating in PNG today.

Trusted business research in PNG

Tebbutt Research’s role in both the 2014 and 2024 studies reflects a long-standing capability in business and social research in Papua New Guinea.

Our work combines research design, field implementation, local interviewer networks, data quality systems, quantitative and qualitative methods, analysis and reporting. That combination is essential in markets where good data can be difficult to obtain but is critical for good decision-making.

The 2024 study is the latest example of Tebbutt Research’s contribution to PNG’s evidence base: practical, locally grounded research that helps governments, development partners and the private sector understand what is happening in the real economy.

Read the 2024 report

The full report is available through DFAT:

Papua New Guinea Micro, Small and Medium Enterprises and Informal Sector Study – Detailed Findings Report

Related research using the 2014 SME Baseline Survey

• How do perceived obstacles to operation and expansion relate to subjective measures of enterprise performance? Evidence from a survey of SMEs in Papua New Guinea
• Do Women Face Different Barriers than Men when Participating in SMEs? Empirical Evidence From Papua New Guinea
• Use and Impact of ICT on SMEs in PNG: An Empirical Analysis and Implications for Policy
• Barriers to Internationalisation of Indigenous-Owned Micro, Small and Medium-Size Enterprises in Papua New Guinea
• A scoping study to provide an assessment of SME policy priority areas for Papua New Guinea
• The Perceived Impact of Public Sector Corruption on Economic Performance of MSMEs in a Developing Country