Sixteen people have died in violent riots in Papua New Guinea after some residents took advantage of police being on strike on Wednesday to set shops and businesses alight in the capital.

Report informs via foreign media that nine people died in the country's capital of Port Moresby while a further seven were killed in Lae, PNG's second largest city, according to an update from Lae Metro Command.

Paramedics responded to multiple call-outs last night involving severe burns and gunshot wounds.

Local security services described the rioting overnight as total anarchy.

Videos of the unrest show warehouses engulfed in flames and large crowds of people engaging in looting and rioting.

On Wednesday, police, defence and other public servants held a demonstration at Parliament House over a payroll issue.

Police officers stood down at 10am local time as part of the action.

But it soon escalated into a dramatic security situation as hundreds of residents took advantage of police being off duty to flood the streets, setting shops and businesses in the capital alight.