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This is understandable after the strong reaction to the World Bank push to privatise government-run businesses like banks and utilities. Prime Minister Sir Michael Somare made it clear when he took office at the helm of the previous government in 2002 that he was not keen on privatisation. After the wave of privatisation that has occurred in much of the western world during the 1980s and 1990s, the term is not so much in vogue anymore and the catch phrase these days in PNG as elsewhere is public-private partnership (PPP). These PPPs can take various forms and shapes from straight out privatisation down through to government outsourcing of various duties and functions to new forms of infrastructure construction such as private sector funded toll roads. The recent entry of Digicel into the marketplace has raised public awareness of the merits of increased competition through benefits that flow to the public especially in a situation where public utilities have continually under-performed over many years. Even before the entry of Digicel, many became aware of the benefits gained from the discipline and competitive nature of the private sector when PNG Banking Corporation was privatised. It was fortuitous that PNGBC was taken over by the then minnow Bank South Pacific to provide meaningful competition to the two Australian-owned banks – ANZ and Westpac. BSP is now a trend setter and innovator on the PNG financial scene, tending to lead the way with lower interest rates and by becoming the first bank ever to offer 25-year housing loans to customers. Further it is providing good reason for increased national pride by establishing a genuine PNG banking presence in neighbouring island nations such as Fiji, Niue and Solomon Islands. In contrast to these two examples, Post PNG has become a model both locally and regionally for a Government-owned and run organisation that is as creative and innovative as any similar private sector organisation. The key reason for this is that during the era in which PNGBC was privatised, Post PNG was corporatised. Nursed back from the brink of bankruptcy, it has been given a new slim structure and a clear mandate for future operations. With minimal government interference, and avoiding political cronies who often tend to cause havoc, Post PNG is being run as an efficient government-run business. One of the secrets of its success is its high levels of transparency and tough reporting standards on its corporate and financial performance although, like other state-owned enterprises, it too has a lot to learn from more pro-active public relations strategies. There is little doubt that increased avenues for competition in sectors such as telecommunications, power and transportation would bring vast benefits to the public. Telikom PNG has certainly picked up its act since the onset of mobile phone competition, but the slow pace of internal reform is retarding the potential dynamism of this sector. Telikom seems to always be on the back foot and constantly having to make excuses about the lack of adequate infrastructure, problems created by vandals and it continues to show a general lack of responsiveness to public criticism. Current efforts to split Telikom into a company that operates national infrastructure and a services arm appears likely to further delay the more all-encompassing dynamism the public needs to experience and appreciate. The network built at considerable cost by Digicel gives that company a competitive edge in mobile telephony which, arguably, could be lost if the infrastructure is swallowed up by some non-responsive operator. How long will that process take anyway? A more ideal solution is to allow different operators to set up their requisite infrastructure and for the country to avoid excessive expenditures in a national network by guaranteeing interconnectivity. That way an integrated system will be steadily upgraded with investment from Telikom as well as Digicel and possibly Greencom. It must be remembered that every Digicel phone call made to a B Mobile phone or to a phone connected to a landline will represent additional revenue for Telikom and vice-versa in the case of Digicel. Even though PNG Power is undertaking some excellent initiatives, such as the electrification of Southern Highlands, there is similar scope for increased competition in this sector. Do companies and the public in Port Moresby have to wait for big projects such as the planned gas pipeline from the Highlands and the LNG project before a more reliable and predictable power service becomes the reality? One would hope not. With almost every significant company operating in the nation’s capital requiring their own back-up power, one wonders if PNG Power has ever got around to assessing how much stand-by capacity is available from SP Brewery and other industrial concerns? Are brownouts and blackouts going to continue to be the order of the day every time there is a breakdown at the Kanudi power station? Can these disruptions be minimised with some creative solutions? This is the kind of dynamism that is lacking on the power scene in important centres like Port Moresby, Lae, Madang and elsewhere, all of which appear to be waiting for the next big power project to smooth over ongoing problems. With some financial incentives, possibly through the next budget, some of the major industries in PNG may be encouraged to build extra generating capacity that can be used to minimise power disruptions. That too would be a useful aspect of private-public partnerships that would provide an improved environment for increased investment activity.
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