Grassroots PNG encouraged to develop businesses
Papua New Guinea's Indigenous Business Council says more needs to be done to help grassroots people access capital in order to start up business but also asserts that people should make more of an effort to take advantage of some of the regional opportunities now available.
The Papua New Guinea Indigenous Business Council says grassroots business people in the country need more help in accessing capital.
The Council has been working on securing government buy-in on its plan to increase the indigenous ownership of the formal economy to be 70 percent by 2050.
The Peter O'Neill-led government has been establishing such programmes as micro-financing for small holder agricultural operators and funding for Small to Medium Enterprises, SMEs.
However, a member of the Indigenous Business Council, Hubert Namani, told Johnny Blades that there could be much more grassroots participation in business.
HUBERT NAMANI: I mean generally the cost of living in PNG is very expensive. So how do we bring in our locals? There's always been that so in 2011, there was an indigenous business summit in Kokopo. That was led by the National Development Bank. The current Trade Minister Richard Maru was the champion of that. They had some decl arations out of there, mainly pushing government to bring in incentives to promote the small business, indigenous business mainly, and since then there have been a number of.. I know government's put a lot of money into the National Development Bank to support the locals. There's a lot of work that needs to be done still. One of the key outcomes was the call for the set up of the Foreign Investment Board, and I think a lot of the reforms are still ongoing. Right now, the Department of Trade, Commerce and Industry and the Small Business Development Corporation are working on SME policy, a new policy that also brings in certain industries that will be restricted to indigenous businesses only.
JOHNNY BLADES: What are they?
HN: It's still being worked on. But it's basically to provide a space for incubation of small business. It's like any contract under 5 million (kina) in road construction should be restricted to local businesses only. Certain contracts when you're building the big flyovers, we have groups from New Zealand liuke Hawkins who can fo that, and we bring them in. But certain space should be restricted for indigenous business for an incubation space, give them the space to grow. But I guess that's not just a solution. We need to do more than that. We're talking about high cost of business here. Telecommunications are so expensive, property is so expensive. So even before a business starts... it's killed before it even starts.
JB: That participation thing is so important, isn't it, but is there a sense that it's growing? Are people in the settlements in urban areas any more involved now in development?
HN: Yes, the other thing is that there are a lot of opportunities out there. It's for people to get off their back and get out there and take advantage of those opportunities. There are a lot of success stories out of the landowner companies now from the PNG LNG Project - one of the biggest ones is Trans Wonderland - they own a big airline company that's running in the middle of Australia. There's a lot of success stories around. But going down to the grassroots level, I think they're the ones that really need support. Sometimes, I think government needs to put some programmes into providing them incentives, microfinancing. I'm not sure we're doing enough. I don't think we're doing enough
JB: There was that Small to Medium Enterprises business conference last year in PNG which talked about this sort of thing...
HN: It's still a lot of talk. People on the ground need to feel that. There's a lot of money going into the National Development Bank, but it's still hard for grassroots people to go into the National Development Bank and get a loan. So they really need to look at it again, holistically. It's not just capital. My view is that there's a lot of ways of supporting through tax credit schemes with the big resource developers and landowner groups.
JB: And what would you say about the role of traditional Melanesian values in development, are they something that is an asset and are they being looked at as such?
HN: I've always thought that the way Melanesians do business is totally different from the way the western world does business. So obviously we need to protect, promote and maintain the Melanesian values but we 've got to bring some commercial sense into it. Here the Melanesians look after their... it's one man for their tribe, their tribe for one man, and they look after eachother, they look after their family's societies. The business is like an insurance cover for them.
JB: It does seem like PNG is at a bit of a junction. Not just the growth in money coming in, but also this opening up of discourse, knowledge.
HN: Yes, PNG right now, we're at this juncture. It's a transition period. There's a lot of reforms now around SME policy like I was just saying. There's a generation change all the way from parliament down. The younger guys coming into business now, they're smarter, sharper with the business exposure through internet and all of that; that generation is the generation that will change this country. And we've recently come back from Fiji. I've been supporting the PNG Indigenous Business Council. We went for the Fiji Indigenous Business Council's symposium. One thing that came out of there was the establishment of the Melanesian Indigenous Business Council. Main outcome was the signing of the MOU with Fiji, Solomon Islands and PNG, setting up the Melanesian Indigenous Business Council. And at a later date, we'll bring on Vanuatu, get the others in and get it started. It should take advantage of the Melanesian Spearhead Group Trade Agreement, free trade within Melanesia. We can go, PNG can go to Fiji, through Melanesia, without a visa, whereas with Australia and New Zealand, we have to apply for a visa. So in terms of business, you can just get on a flight and go to Fiji and talk business with them. Besides, for PNG it's cheaper doing business in those countries than in PNG. And at the same time, looking at the investment, we should also look at investment destinations in Melanesia, within the region, before going out. And plus one of the reasons the group had was, down the line, having a big trade show of the Melanesian indigenous businesses, bringing the Kanaks, bringing the West Papuans, bringing everyone.
JB: Why haven't these things been done before. They've been talking about the trade agreement in the MSG for a long time.
HN: A lot of people look to politicians for the answers. But with this, it's got to be private sector driven, and we need to get off our back and start taking advantage.
To embed this content on your own webpage, cut and paste the following: