TREASURER Peter O'Neill assured Australian and Papua New Guinean private sector players that the government was committed to creating a strong and robust economy by providing a stable and conducive environment for business investment in PNG, The National reports.
The assurance came after the government achieved a record budget surplus of K186.3 million equating 0.7% of the gross domestic product (GDP) this year as a result of prudent fiscal management and effective implementation of the 2011 national budget.
Speaking at the 27th PNG-Australia Business Forum and Trade Expo in Madang yesterday, O'Neill said: "PNG can achieve real economic independence because of the anticipated economic growth.
"The partnership with the private sector will ensure this growth will be sustained."
O'Neill announced the total revenue and grants for last year was lower K8, 278.9 million, higher by K34.4 million of the revised budget estimates.
He said the total expenditure and net lending last year was lower by K151.9 million of the revised budget for, thus giving a surplus of K186.3 million, a significant achievement given budget deficits in 2008 and 2009.
Updating on the 2011 budget outcome, he said by the end of last month, 60% of the recurrent budget and 40% of the development budget warrant had been released to agencies.
"This is a significant achievement and it's now the responsibility of agencies to deliver the governments agenda," O'Neill said.
"The government needs to manage its finance prudently to ensure that demands for cash are met but also to ensure that the cash that is released is used to deliver services and does not end up sitting idly in the bank accounts."
The treasurer informed the private sector that the government was aware of the importance of successfully implementing the budget for communities and families.
He said, this year, the government would ensure that funding was available in the timely manner to ensure
delivery of services throughout PNG.
The former opposition leader stressed that while outlook for this year was very positive with expected growth by 8% largely due to ramp up of PNG LNG construction, non-mining GDP was also expected to grow by 8.2% which would provide a significant boost to activity in other sectors of the economy, with rising incomes and consumptions from businesses and households.
Despite the growth, O'Neill said unfortunately inflation remained one of the key challenges for the government.
He said the government was committed to contain the high inflation rate of 8.2% by maintaining its expenditure with budget appropriations while closely monitoring monetary policy in particular the currency and interest rate movement and reserve deposits equipment.