Learn From Malaysia, Somare Tells PNG

Good to see you...Sir Michael Somare welcomes Dr Mahathir Mohammad (left) to Papua New Guinea.

Papua New Guinea must draw on the experience of Malaysia if it wants to progress to become an economically independent nation and adequately provide for its people as well as being a power to be reckoned with.

With this in mind and with Papua New Guinea's intention to cultivate bilateral relations with neighbouring countries, Prime Minister, Sir Michael Somare challenged Malaysian businesses through their Prime Minister, Dr Mahathir Mohammad.

He told Malaysian businessmen to industrialise PNG particularly now when:

• its economy is in a precarious situation with business confidence at its lowest;
• its currency, the Kina also reaching its the lowest since its floatation in the open market,
• fiscal discipline lacking,
• political stability compromised; and
• generally a lack of clear direction at the political level.

He was speaking at a luncheon hosted in honour of his Malaysian counterpart during his recent two-day visit to PNG.

Malaysian investors imbued with Malaysia's experience must bring these experiences with them to Papua New Guinea.

"Investors must know that we will do everything possible to allow them to successfully do business here," he said.

But he stressed that they should create a level playing field so that local entrepreneurs can participate too in line with the government's aim to support its citizens to take part in business ventures.

He said Malaysian investors with their background should actively engage in the industrialisation of PNG as Papua New Guineans are now more determined to assume greater control of the nation's economy.

This may be an impossible task for a small economy like ours but we must move from aid to trade.

"At the same time, they should not merely be extractors of natural resources but also producers and exporters," he said.

He said in a predominantly rural society, downstream processing creates employment in the resource area and contributes significantly in transforming the lives of the people of the area.

"Where Government cannot easily reach, investors can when there is opportunity."

Somare is adamant that PNG will learn from the Malaysian model for development, economic independence and prosperity to influence the nation's growth.

Malaysia, being the second largest investor in PNG after Australia, has set benchmarks and PNG should learn from these experiences in pursuing economic growth and prosperity.

"If developing countries throughout the world need a model to guide them through the complexities of development in this competitive world, Malaysia under Dr Mahathir provides a practical model of what is possible," he said. He expressed confidence in the Malaysian model because of its leade's determination during the country's currency crisis in the late 1990s resulting in Malaysia designing its own solutions to its problems which influenced its economic recovery.

The PNG leader applauded the Malaysian leade's ability to critically embrace democracy and capitalism to suit the country's social, economic and political environment while being critical of blind imposition of values developed and marketed by the developed countries to assert their dominance in the world.

Somare said the changing face of the international market place requires innovative ways to protect the interests of developing countries. PNG is heading that direction by looking at potentially drawing from the Malaysian experience for progress.

He was blunt in saying that PNG is moving away from accepting others perception of good governance‹of being told to remove nationalistic strategies to safeguard their markets from foreign intrusion.

Somare said: PNG has been a beneficiary of substantial volume of aid from friends. Although aid is good for PNG, it has disadvantages.

"There is always a prize to pay in exchange for presents like aid funding and often times PNG is told to abandon its nationally developed strategies." But as PNG approaches its 30th anniversary, Somare wants to ensure that Papua New Guineans assume greater control of the nation's economy.

"This may be an impossible task for a small economy like ours but we must move from aid to trade. Aid now must contribute to building our capacity to engage actively in trade with other countries," he said.

Among other things, he would like to see PNG add value to its exports and use its abundant oil and gas reserves, land, forest and marine resources to trigger off industrialisation.

He added that countries with identical experiences must move closer to each other as the barrier keeping us apart is removed through globalisation and information technology."

He was reiterating his statement after arriving from an APEC meeting in Thailand in which he stated PNG's support for the initiative undertaken by APEC to establish a regional bond market particularly beneficial to smaller and developing economies like PNG.

Both leaders agreed to a ministerial dialogue each year for annual consultative talks to talk on economic and regional issues.

They also agreed to enter into a development cooperation agreement to facilitate Malaysia's help in information and communication technology; for state-controlled Petronas Berhad Malaysia to help PNG develop its oil and gas resources on a joint venture arrangement, and increase the level of trade and investment between the two countries.

Mahathir said there were no quick solutions to PNG's problems but his visit to PNG was to show confidence in this neighbouring country, and through collaboration, Malaysia would increase its investment portfolio in Papua New Guinea.