22nd Australia-Papua New Guinea Business Forum

Introduction
Distinguished guests, ladies and gentlemen.

I'm disappointed that I can't be with you in Cairns today.

But I'm glad to be able to pass on my best wishes in this video message.

The business relationship between Australia and PNG is one of the key links between our two countries.

I am always impressed with the vigour and activism of the Australian and PNG business councils…

… and the strong participation of business representatives in our annual bilateral Ministerial Forum.

It seems to me that PNG's improved economic performance in recent years has led to a better business environment. Investor confidence in PNG is now significantly higher than in the past.

High export prices have no doubt helped. But just as important has been stable macroeconomic policy, for which the PNG Government is to be commended.

But high commodity prices won't last forever. So PNG will need to further enhance its attractiveness as a business destination.

The lesson from the Australian experience is that economic reform is an ongoing process.

I am pleased to acknowledge the efforts of the business community in PNG in supporting reform efforts.

Indeed, PNG has made good progress on the economic reform front over the last couple of years.

Its 2006 budget provides a strong framework for pursuing the Government's medium term objectives. We hope that PNG can consolidate this through its effective implementation.

It will be particularly important to ensure that discipline and the focus on good governance be maintained over the year ahead, in the lead-up to the mid-2007 elections.

My Government is strongly committed to helping PNG improve the environment for business. In this context, I am pleased that the Enhanced Cooperation Program (ECP), as well as the wider aid program, continues to make an effective contribution.

Forty Australians are now in place in various PNG Government agencies under the ECP, working in support of economic management; financial control; border control; transport safety; and law and justice.

They are particularly focused on improving systems in order to reduce opportunities for waste and corruption.

I think we were all disappointed that, as a result of legal issues, arising from a PNG Supreme Court decision last year, it was necessary for Australia to withdraw ECP police personnel.

The two Governments are discussing a possible revised package of assistance in that area.

We look forward to continue working with the PNG Government to build upon the work of the ECP.

The support we provide to PNG through our overseas aid program also helps to assist efforts to improve the environment for business in PNG.

I recently launched a White Paper that will direct the delivery of Australia's aid over the next 10 years.

The Australian Government has made it clear that our aid comes with reciprocal responsibility…

…governments receiving aid must strengthen governance, reform and actively combat corruption to ensure aid makes a difference.

A new strategy to guide Australian aid efforts in PNG has been developed with PNG. It contains a stronger focus on economic growth initiatives, expanded efforts to improve service delivery, increased attention and support for HIV/AIDS and a focus on underlying issues of nation building, including good governance and anti-corruption activities.

Bilateral trade and investment is growing in a number of areas. The PNG gas project, in particular, could be a major expansion in our economic relationship. We very much hope to see it go ahead.

We appreciate the size of the task facing PNG in laying the ground work for the project. We have offered to provide up to seven technical advisers to assist.

I am sure that the Business Council will agree that the decision by the PNG Government to set-aside 400 million Kina in the 2006 budget towards its share of the project sends a very strong signal of the Government's commitment, and should be commended.

In conclusion, I would say that I do appreciate the role the business community plays in our bilateral relationship.

It seems to me that many of our companies play a somewhat under-recognised role in transferring skills and managerial expertise to PNG.

The impact is positive and entirely consistent with the Australian Government's central objective of helping PNG to achieve long term prosperity and stability.

Thank you for the opportunity to provide an address to you today. I look forward to hearing the outcomes of your discussions and to meeting with you face to face in the not too distant future.

ENDS