Maru pushes for local growth

GROWING a locally owned business is needed for progressing national development, says Minister for National Planning and Monitoring Richard Maru.
He said this was the cornerstone for a strong economy. He was giving the opening speech at the Asia Pacific-Economic Cooperation Business Advisory Council (Abac) MSME and innovation summit earlier this month.
“Papua New Guinea has a dual economy, which basically consist of the formal and informal economic sector,” Maru said.
“The formal sector consists mainly of registered companies, both local and foreign-owned.
“The other sector is the informal sector which consist of individuals and families who do not have formal registered companies. This sector is where 80 per cent of our people live in our rural villages and community and work and trade and do business in mainly markets in our town and cities and along our highways and are also referred to as our informal cash economy.
“Increasing those in our urban centres in the formal economy also supplement their income by producing and trading in the informal cash economy, in our urban towns and cities and our district towns.
“We have a relatively small formal sector which has only 50,000 formal registered SMEs, which employs 200,000 citizens and
contributes to 10 per cent of our GDP.
“Our informal sector is worth 20 per cent of the GDP is valued at and estimated (to be worth) K12 billion a year. Taking the extractive sector out, it is worth 30 per cent of our GDP.
“To be frank, over the last 40 years, one biggest challenges our country has faced has been our ability to grow the SME sector.
“While we are open to inviting more foreign direct investment, we need to ensure there is a more-level playing field in the SME sector.
“There is no doubt that our economy needs the top end of town – the big businesses, both domestic and foreign, to drive our economy forward. But we also know, that at the same time, real economic and social development cannot happen without growth from our grass roots.”