PNG and Australia relationship remains unique
The PNG-Australia relationship is unique as it is rooted back in history and has further evolved from an aid-dependency to a strategic partnership.
When addressing the 35th Australia- Papua New Guinea Business Forum and Trade and Expo at the Stanley Hotel today, Secretary of the Department of Foreign Affairs and Trade, Ms Barbra Age, said discussions have now changed from ‘relationship’ to a strong ‘partnership’ between the two countries.
She believes a new partnership can explore the many opportunities that both countries can offer.
“In this regard, the relevance of this year’s theme - the “Road Ahead: Optimizing Infinite Opportunities” comes at a most opportune moment for both countries to focus on ensuing discussions as they underlie two important factors of this shift.”
Ms Age said firstly, trade and economic and secondly, the PNG-Australia relationship has largely been a “one-way traffic” with trade, investment and business more in Australia’s favour.
She believes there are many opportunities for both countries to expand the scope of business and trade.
“There are challenges but they can be overcome, if we have the will and determination to make a difference”.
She added that cultural differences often create stumbling blocks, however the “Wantoks” concept which loosely translates to “one language” can be a useful principle or concept that can use to bridge the cultural differences.
“This is important because fundamental to all this, is the people-to-people links,” she said.
It also underscores the importance of the growing PNG-Australia partnership at different levels such as at the high-level political dialogues, official visits, senior and economic officials’ meetings, trade and investment working group meeting, cultural exchanges, sports, and business-to-business.
“Whilst we have a well-structured dialogue framework, it is important that the relationship is encompassing at all levels including SMEs so that this partnership permeates all throughout”
“I believe that our partnership should also focus more on trade and investment opportunities, including promoting B2B (Business-to-Business) engagement”.
Secretary Age further said that a trade agreement, among other things, provided that element of predictability for business and trade, but does not always provide the solution.
She said, a large part of the equation lies in the issues behind-the-border, at-the-border or across-the-border.
“We can conclude the best trade agreement, but it won’t yield the expected results if we don’t address the supply-side constraints and demand-side issues. This is where the Government’s role as the facilitator is crucial.”
Ms Age said the biggest policy challenge for PNG is the dualistic nature of the economy and how to transform the rural communities and migrate them to the formal economy where they can take advantage of business opportunities, let alone international trade.
Agriculture remains the backbone of the economy; and with a high percentage of the population, about 85 percent, are engaged in subsistence agriculture.
“The ratio of labour or employment to GDP of the formal economy compared to the non-formal economy presents a formidable challenge for policy-makers.
“The formal economy employs less people (i.e. labour) but contributes more to GDP whereas the non-formal economy, comprising the informal economy and rural population engaged mainly in subsistence agriculture, provides employment for the majority, but their contribution is or may not be reflected in GDP calculations.”
Secretary Age said the focus was on growing the agriculture sector to build the capacity of rural farmers to take advantage of trade, investment and business opportunities.
“The supply-side is a greater challenge for Papua New Guinea. For our goods and products to benefit from trade agreements and enter the Australian market, it is important to building the trade infrastructures including the roads, ports, and airports that meet international standards.”
“At the heart of the opportunities lies the fundamental piece required to make it happen – the human being. It’s the humans that make it work; hence, we see the value of the Pacific Labour scheme under the Australia Step Up policy.”
“We need to invest in education and move towards a knowledge-based economy that shifts the focus from primary commodities exports, manufacturing to services,” Ms Age said.
PNG welcomes the PNG Electrification Partnership Project through the support and commitment of Australia, Japan, New Zealand and the United States to ‘light up’ 70 percent of rural PNG by 2030.
These were among the many outcomes from PNG’s hosting of APEC 2018, under the theme, “Harnessing Inclusive Opportunities: Embracing the Digital Future”
Secretary Age said the Marape- Steven Government is looking forward to working in partnership to fulfilling the objectives of the MoU between PNG and Australia on the Coral Sea cable system, and its importance to bridging the digital divide and reducing the high cost of doing business to promote economic growth and development.