PNG Chamber of Mines and Petroleum Vice President Richard Kassman together with local representatives from Deloitte, the Business Council of PNG and the Institute of National Affairs stressed the importance of Papua New Guinea’s resources sector to the economy and community following the call on the government to review its proposed Organic Law into an agreement for the petroleum and mining sectors.
Deloitte highlighted statistics from an economic review that the PNG resources sector is at 23.9 per cent of government revenue, higher than previous figures. This revenue has come from sources such as salaries and wages tax, corporate tax, and dividend contributions, as well as indirect sources.
Deloitte Director of Tax and Business Services Maygen Turliu said that this revenue allows the government to offer more extensive support to provinces and communities around the nation, and calls the government to undertake a robust consultation. “Given the significance of this contribution, and of the industry to the financial position of the PNG Government and country, it is essential the Government provides the industry with a clear consultation framework as complex employment and industry structure reforms are discussed,” she said. “Tax reforms don’t have to be something very big. You can tweak the current system so it fits both parties. You don’t need to do a totally new thing that could disrupt business, particularly with COVID-19 in place.”
She added, "Consultation is key for businesses in PNG. The Government should be giving more access for open discussion on proposed reforms and allowing businesses to work with them to inform these reforms as they're being developed.”
Meanwhile, Executive Director of national independent think tank organisation, the Institute of National Affairs, Paul Barker, said this pandemic has brought to light the need for collaboration and certainty between the resource sector and the government.
“Now is the time to stimulate greater activity in this essential sector to our economy by creating a secure environment that provides investors with the confidence to act,” he said. This will deliver Government much greater volumes of direct and indirect revenue, and do it much more quickly, than looking to nationalise the operation of this critical sector. At this point in time, as a nation, we should be looking to expand the size of the resources sector rather than doing anything that risks reducing it. This will only be achieved by creating an environment where the Government is working alongside the industry and providing the necessary financial assurance required to stimulate activity across the industry and its investors.”
Furthermore, Steamships Trading Company General Manager for Corporate Affairs David Toua stated that stability is an important factor in making a triumphant business recovery. He further cautioned the government not to risk revenue loss through the misinformed resource to the business sector.
“Businesses around the country rely on the resources sector to help create demand for their services,” he said. “Putting the resources sector at risk jeopardises the livelihoods of a huge number of PNG business owners, as well as their employees – a move that would simply exacerbate the uncertainty of a looming recession in our nation.”
Mr Kassman repeated the willingness of the parties to discuss the matter at hand. “The concerns that we as a sector express are not anti-Government. Time and time again we hear the views some of us as Papua New Guineans have are either anti-government, antinationalistic or unpatriotic, and that is far from the truth,” he said. “What’s important is that we want to contribute to an effective discourse, so our leaders are well informed in order to make good decisions for the future of our country.”
