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**** Speech by Hon. Peter O’Neill CMG MP - Prime Minister of Papua New Guinea At the Prime Minister’s Business Breakfast - “Strengthening Partnerships for a Prosperous Papua New Guinea.” 12 February 2015, National Parliament, Port Moresby ****
February 12, 2015
Business Council PNG President David Toua
Executives of Business Council PNG,
Ministers of State,
Chief Secretary and his officials,
Good morning everyone.
I am once again pleased to be part of this gathering.
I want to thank the Business Council for giving me, again, this opportunity to speak with you today. This is important because we are partners in national building.
This opportunity to speak to you today also enables both the public and private sectors to talk frankly about issues and challenges that we face in our country.
It also gives us a chance to talk about how collectively we can address these challenges in order to built a prosperous and robust society in Papua New Guinea.
Many of you know that Government cannot do it alone - likewise the private sector cannot do it alone either. We need each other and that is the reality not only in this country, but everywhere in the World.
The success of this public-private partnership is evident in countries which continue to build very strong and robust socio-economic development for their people.
This is a simple formula, which has produced astounding results – it does not need an Einstein or very smart people to understand that.
The theme today ““Strengthening Partnerships for a Prosperous Papua New Guinea” is fitting for such an occasion.
We need to speak freely and frankly about how we can work together in a meaningful and more constructive manner.
The Government does not have all the solutions. That is why we reach out to you, as partners, so that we can address many of these issues - whether they are institutional, legislative or financial issues.
The role of the Government is very simple. That is one of a facilitator. Our job is to create a healthy, safe and skilful society.
We believe that by fulfilling that obligation we will create a stable environment for the growth of the private sector - which is vital for job creation and improvement in the quality of life of our people.
I want to say few things about what our Government is doing since taking office in 2012, and how we are improving so we can strengthen our partnership.
As many of you know, this Government has been focusing on key areas. These areas that we have committed to the people are our pillar policies of education, health, infrastructure, and law and order, and building a strong economy for our country.
Since 2011 we have invested heavily in these areas.
For example, when we came to office, investment in the health sector was averaging 10% of our total budget outlay. Today we have increased that to over 20% – we doubled the budget allocation for healthcare in our government.
Education is another sector which was neglected for many years. Today funding for education has grown to over 20% of the budget, and we are educating more children in schools today than ever before.
We have invested heavily in infrastructure over the last two and a half years. Including our investment in the Pacific Games and other infrastructure, we have invested close to 5 billion Kina in infrastructure all around the country.
We are doing the same in the Law and Order. We are modernizing our law and enforcement agencies so that they can become more vibrant in upholding the rule of law in our country.
All these sectors, which are vital for a healthy, safe and skilful society. This Government had no choice but to rescue these agencies for the good of our country. Not doing something would be unacceptable and we would be doing great injustice to our people and the future.
It has not been any easy task – and we will not fix everything in a few years. The task ahead of us is massive. It will take massive effort and sacrifice and commitment to overcome these challenges into the future.
I would be misleading you if I say it will be easy.
But what I can say to you today is this Government is focused – and we are making the right policy choices, and we are making the right investment decisions.
The changes are happening everywhere in the country. I can tell you that our investments are beginning to produce results.
I am well qualified to make this assessment, because I have travelled to every province in the nation over last two years, and visited remote parts of our country.
I can see changes – I can see smiles in the faces of our people.
People can see hope because for the first time in many years, they are able to send their children to schools, go to a medical centre that is well stocked so that the can get treatment, and go to markets so they can sell their produce.
Our Government is also taking a lead role in trying to understand what the private sector needs in order to build on our partnership.
Let me now focus on some of economic issues that are confronting us today.
The decline in the oil price, and fluctuations in the resource price, is a growing concern for everyone around the world. It may be good for the businesses because it will help reduce the costs of your businesses.
But for governments, we depend on the revenues that come from these industries, and it is a challenge when it comes to balancing our budget.
The potential strain on our money plan will not be underestimated. We know if the price remains low for a long while, which what the experts are saying, we will have to make some hard decisions at some point in the future.
For now I am quite confident that our economy remains very strong. This is because our fundamentals are sound, and if we invest smartly, we will continue to see unprecedented level of economic growth in our country.
As a Government, we will focus on delivering these critical investments, and we will continue to strengthened investor confidence and make sure that we maintain the growth that we are enjoying today.
This confidence has been noted by Standard and Poor’s Credit Agency, which is very positive news for our country. Because, this reconfirms our strong Government policies, our strong fiscal management and stable economic environment that we are enabling in this country.
The challenge for this Government is to manage and maintain our Money Plan for 2015 among these challenges.
I say with confidence, that we will deliver the budget according to the money plan. We have done so over the past two and a half years and we will do so over the next few years. We have stated that we will have a balanced budget by 2017 going into 2018, and we are very much on track.
I would like to see more positive participation from the private sector in some areas where we can partner.
This includes providing housing for your our employees.
Our people will to increase their productivity if they have a stable home environment. That is why the Government is pushing ahead with housing programs in the country.
One of the key initiatives has been to partner with the Bank of South Pacific, where we have allocated 200 million Kina for the housing Loan scheme. We urge the business community to know that this is not only for public sector employees – this is for every citizen in the country.
We encourage the private sector to participate, because if you look after your employees they will look after your business.
This loan is available at 4% interest rate and period 40 years. This is unheard of in the financial sector in this cuntry.
There is further opportunity to invest in power generation. There is a huge and increasing demand for energy in our country. Our drive now to encourage independent power producers in the country is a step in the right direction.
We need to continue to work together as well in areas such as agriculture and tourism that have huge potential. This is where we can work together so that partnerships are developed between the Government and the private sector.
We have a number of major events coming up in the next few years in Papua New Guinea.
One of these is the Pacific Games in July. Let me say that despite some cynics who think that we might not deliver the games on time – we are on track. We are certain that we will deliver the best games the Pacific has ever seen.
We are also preparing for the hosting of APEC in 2018. We have introduced the APEC Authority to oversee the planning of this event. We are now in the process of recruiting a Chief Executive Officer, with the assistance of the New Zealand Government.
This particular event will be game changer for Papua New Guinea. We will have 21 of the biggest economies in the world in our country.
We must take full advantage of that. Leading up to that there will be up to 200 APEC related meetings taking place in our country.
Again, I ask the private sector to play a prominent role in the hosting of these events leading up to APEC.
The Chamber President talked about business regulatory reform, and I agree that there is a lot to be done.
The environment in which business regulations have been carried out in some of some of our public service, has been discouraging at times to say the least.
I can assure you that this particular area has the attention of our Government. You can be assured that we will do everything possible, to get the one-stop-shop idea up and running. We are having challenges because there is quite a determined resistance coming from some of our public sector employees.
Every day we seem to fight our own people, fight the public service, has been one of our battles since taking office in 2012.
They feel comfortable with current environment and they do not want changes. They resist it with a lot of determination, and it is a resistance that we will certainly overcome. I want to assure you that reforms will be taken forward. I want to assure you that the processing of visas and work permits for international skilled workers and business people will be much easier.
I know it has taken us over two years to get there, but I can assure you that we are making some steady progress. In fact some of our leaders in some of those departments are starting to see light at the end of the tunnel.
Another reform that is taking place is Tax Review. Sir Nagora Bogan is leading discussion on this matter. I am advised that it will be ready this year and we are hoping that some of the recommendations of that review will be captured in the 2016 budget that we will present later in the year.
Many of the tax reforms – I know there is a desire for reductions in some of the tax rates. But again, we must expand the tax base so that every citizen, and every business pays their fare share, so that we can continue to build in the investments that we are making such as in infrastructure, health and educations. So that we can share the burden together.
Finally, let me leave you with this key point - this is a business-friendly, we are a business-focused Government.
We will work closely with you because we want to see the partnerships that we have in many areas, like the social programs that the business community have, truly develop so they can deliver benefit to communities through the country.
Once again, thank you very much for listening to me today.