Media Statement | Friday, 17 July 2026 Nasfund CEO Outlines Potential Investment Structures to Support Member Returns, Liquidity and Broader Participation in PNG's Resource Growth

Speaking at the Finance in Resources & Energy session of the 2026 PNG CORE Resources Week, Nasfund CEO Rajeev Sharma outlined how the fund is assessing investment structures that could support member returns, maintain liquidity, and enable broader participation in Papua New Guinea's resource and infrastructure growth.

Sharma said superannuation funds face the ongoing challenge of balancing long-term growth opportunities with the need to maintain sufficient liquidity to meet member benefit payments. With approximately 10% of Nasfund's membership withdrawing their funds each year, liquidity remains a critical consideration in the fund's investment mandate.

He explained that Papua New Guinea's long-term inflation rate trends at approximately 5%. After accounting for the 25% tax rate applied to superannuation income and standard fund expense ratios of approximately 1%, a superannuation fund must achieve returns of around 7% simply to preserve purchasing power and approximately 8% to meet the mandate of CPI plus return. 

These return and liquidity requirements are prompting consideration of investment structures that would enable participation in major resource and infrastructure projects while maintaining prudent risk management and liquidity.

Mr. Sharma further stated that staged investment approaches would allow superannuation funds to provide financing during project development and participate in equity ownership once projects become operational.

“A loan-to-equity approach allows us to support major projects in a way that is properly staged, properly risk-managed, and aligned with our obligations to members,” Sharma said.

Convertible bonds were cited as one example, providing interest income during construction before conversion to equity at commercial operation. The potential use of tax-free infrastructure bonds was also noted, with favourable tax treatment capable of improving member returns while supporting investment in national development projects. Sharma added that the successful listing of Papua New Guinea's first corporate bond signals growing depth in the country's capital markets and the potential for additional investment instruments in the future.

All such investments would continue to operate within Nasfund's established governance framework and statutory investment limits, including current restrictions that limit exposure to any single entity to no more than 5% of the fund's total portfolio.

Sharma said superannuation funds have the potential to provide a pathway for ordinary Papua New Guineans to participate indirectly in the country's resource and infrastructure growth through their retirement savings, allowing members across the country to benefit from investment returns generated by major projects.

He also noted that certain resource-related investments have defined project life cycles, requiring fund managers to plan for the orderly recovery of capital over the life of the investment to ensure fairness between current and future contributors.

Nasfund supports initiatives aimed at increasing local participation in resource and infrastructure financing and remains open to discussions with government, regulators and industry stakeholders on investment opportunities that meet the fund's governance, risk, liquidity and return requirements.