One of Papua New Guinea’s major trading partners, Australia has continued to increase its support for the country’s economic development, especially in infrastructure. Business Advantage PNG asks Jon Philp, Australia’s High Commissioner to PNG, about the intent of Australia’s aid program in PNG and its priorities.

William Duma, Minister for State Enterprises, joined Australian High Commissioner, Jon Philp, in Canberra on 16 February, at an officials’ letter exchange between PNG’s Kumul Consolidated Holdings and Australia’s Department of Foreign Affairs and Trade on support for Air Niugini’s fleet replacement program. Credit: Australia High Commission via Facebook

Business Advantage PNG (BAPNG): Given that Australia’s support for PNG is quite significant, right across a host of activities from agricultural assistance to direct budgetary support for the government, what is the strategic intent of that support?

Jon Philp, High Commissioner of Australia to Papua New Guinea (JP): As with the other countries in the Pacific, our strategic intent is to have a really strong partnership with PNG, not only in economic areas, but also in development. This country has enormous potential and strategically we believe Australia’s prosperity is intertwined with that of PNG’s.

BAPNG: How has Australia’s new Albanese-led Labor government’s approach to PNG progressed from where the former coalition government left off?

JP: While the Morrison government introduced the Pacific Step-Up, to really commit to the Pacific and PNG, the Albanese government, is really a step up again from that, with a real desire to see engagement with PNG as a high priority. To reflect how high a priority PNG is, Foreign Minister Wong was here 10 days after Prime Minister Marape was returned to government.

‘Agriculture is also a real priority for PNG, and we’ll work with the Marape government on that too. Beyond agriculture, we think there’s a lot more scope to broaden the base for two-way trade which is around A$5 billion (about K11.8 billion) currently.’

BAPNG: What really underpins Australia’s approach to partnering with PNG?

Jon Philp. Credit: David Foote-AUSPIC/DPS

JP: Before offering development assistance, which the Australian government announced is going to be about A$600 million (K1.42 million) in the year, our overall approach is to sit down with the Department of National Planning and Monitoring, and other departments and find out how we can support their immediate priorities.

Every year we maintain about 1800 kilometers of PNG national roads, based on the PNG’s key-priorities for the year.

Agriculture is also a real priority for PNG, and we’ll work with the Marape government on that too. Beyond agriculture, we think there’s a lot more scope to broaden the base for two-way trade which is around A$5 billion (K11.8 billion) currently.

This is why events that showcase PNG are so important.

BAPNG: Can you walk us through the recent increase in Australian government support?

JP: Australia plans to continue supporting the PNG budget as it has done in previous years. We’re impressed by some of the reforms Prime Minister Marape has been prepared to make to engage in fiscal repair and are happy to support that process; both financially, and in terms of technical support and advice.

For example, the market development facility is an Australian program which aids PNG exports by partnering with the National Agriculture and Quarantine Inspection Authority to help fight diseases such as the fall armyworm, coffee berry borer and African swine fever, which impede PNG improving its agricultural productivity and exports.

Tangible levels of increased funding [above the A$600 million already earmarked for direct bilateral assistance this year] have already been announced, with the Australian budget including an additional A$900 million (K2.13 billion) for the Pacific over four years.

A lot of this funding will of course come to PNG, and infrastructure will always be a large proportion of what we do because those are PNG’s priorities.

Additionally, we’re in health system strengthening, we’re in education, we’re in infrastructure. We’re also in market and business development and recognise that the huge youth labor bulge is a priority for PNG.

We know that women, and girls in PNG don’t contribute to economic activity the way they could, so we have a bit of a focus there too.

BAPNG: What’s the single biggest project the Australian government has committed to in PNG?

JP: Most of the ports funding is via a loan through the Australian Infrastructure Fund for the Pacific (AIFFP), and that enables major projects to be done.

It’s the biggest project we’ve done, with A$620 million for PNG for port development. Overall, we’ve got about A$90 million in [infrastructure and business] commitments to PNG through AIFFP.