No improvement in business climate

Business, Main Stories


THERE has been no  improvement in the PNG business climate so far and it requires a highly favourable business climate conducive to pave the way for the growing business industry.
That includes a more secure legal environment for doing business and encouragement for competitions throughout the economy.
Country economist for Asian Development Bank Dominic Patrick Mellor in his report on ABD Outlook 2010 said yesterday the state-owned enterprises (SOE) hold dominant market positions in many sectors and is a drag on economic growth.
Mr Mellor noted that it was not a healthy environment for doing business for many years in PNG until recently that the SOE had been reformed and went into partnership arrangement.
He said little result had been achieved by the reforms while competition in all sectors had been limited.
“Competition on the communication telecommunication and aviation sectors shows what can be achieved; a new firm (Digicel PNG Ltd) in the mobile telephone led to a notable improvements in phone services in rural areas while a new airline (Airlines PNG) servicing routes between PNG and Australia has cut airfares that enabled people to move in and out of the country frequently,” Mr Mellor said.
However, he stressed that more needed to be done in particular with the SOE that would see considerable increase in demand from the multi-billion kina LNG project.
“Still the Government’s commitment to implementing a public-private partnership policy is encouraging and could potentially facilitate significant private investments in infrastructure,” Mr Mellor said.