I want to thank the organisers for the invitation to speak at this event hosted by the PNG-Australia Business Council and the Business Council of PNG in Association with the PNG Australia Alumni Association.
Since 1980, the PNG-Australia Business Council has helped nurture trade and investment links between PNG and Australia. The Council plays a valuable role in supporting new businesspeople, making its members aware of new business opportunities, and providing advice to both governments on what we can do to make it easier for the business community.
We appreciate the cooperation of the PNG Business Council as the nation's premier business group. Thank you for your support for the relationship between Australia and Papua New Guinea.
I also want to thank the PNG Australia Alumni Association.
One of the strongest stands in the relationship between our countries - besides rugby league of course - is the people who have spent extended periods of time in both nations, like PNG students or officials in Australia. They return home with a deeper understanding of the culture, values and way things happen in each other's country. Their contribution to the relationship between our countries is invaluable.
On a related point, I do hope that all of you will have a chance to join in the Australia Week celebrations that will be hosted by the High Commission next week.
This might be my first visit to Papua New Guinea as Prime Minister, but it is not the first time I have been here.
I came here in April 2006 and walked the Kokoda Track.
Like many other Australians, walking the Kokoda Track gave me a deeper sense of the bonds between Australia and Papua New Guinea than I could have imagined. For an Australian, there's something spiritual about the place.
Our people formed strong bonds as we fought and struggled together in World War II.
There are bonds formed too as we worked together for the transition to independence in 1975, and through the early days of PNG's independence - right through to today.
Many of you know about this history - you have lived through, and you have contributed to it and helped to shape it.
Now is the time for us to look forward - to consider the future of our relationship and to commit to a new partnership that embraces the new challenges of the 21st century: economic development in a global economy now being transformed by the rise of China and India; climate change; regional stability and regional security.
The PNG Story
The future for Papua New Guinea in this globalised world should be bright.
Like Australia, Papua New Guinea has benefited from strong global demand for commodities in recent years.
GDP growth is projected to be over 6 per cent in 2008. It was over 5 per cent last year.
That means the PNG economy is now worth around USD 6 billion - that is an impressive figure in a region where many countries measure their GDP in the $100s of millions or less.
Debt levels have been brought down. The Government has kept the budget is in surplus and the current account is running a surplus.
This country is growing. And it is already the leader in the region - accounting for around three-quarters of the region's total population.
I am pleased to say that trade and investment between our two countries continues to grow.
Our merchandise trade was worth almost $4 billion last year and the balance trade balance is in PNG's favour.
And there are growing opportunities for investment particularly in the resources sector, building on the 4000 individual Australian businesses that trade with PNG each year.
But PNG also has some challenges ahead of it. Progress has been mixed against the United Nations Millennium Development Goals that set targets to reduce poverty, improve health and ensure universal primary education.
The New Australian Government
The new Australian Government was elected to office only 106 days ago.
We were elected on 24 November on a platform of taking responsibility for our nation's future.
To help Australia meet the great challenge of climate change - both for our environment and our economy.
To build a world class education system.
To improve our hospitals and health services.
To fundamentally reform the Australian Federation, by significantly reducing instances of cost shifting, blame shifting, duplication and waste.
To deliver a strong economy that delivers for working families.
During our first three months in office we have begun the project the Australian people elected us to fulfil.
That is to build a modern Australia capable of meeting our future challenges - both for the nation and for working families.
Front and centre on our agenda has been the economy.
Because we believe that disciplined and responsible economic management must be the core business of any government.
At the heart of our economic agenda has been fighting inflation - and keeping downward pressure on interest rates.
At the same time, we have also placed high priority on building long-term productivity growth. We see this as a responsible way of building a strong economy and putting downward pressure on inflation.
Investing in the long term drivers of productivity growth is an underlying factor in our desire to build a world class education system.
We've called it an education revolution - fundamental reform right across the spectrum of education in Australia - from early childhood education, to schools, tech colleges, universities and R & D.
Our Government has begun work on implementing many of our education initiatives - whether it be trades training centres in our secondary schools, computers in schools for all year 9 to 12 students or the bringing forward of 20,000 skills training places - the ball is well and truly now rolling.
We have also placed high priority on developing the infrastructure needs of the country.
We have established Infrastructure Australia to conduct an immediate audit of the capacity constraints which exist nationwide and we are committed to acting on the bottlenecks which create unnecessarily further inflationary pressures and hold back productivity growth.
On climate change our government has now ratified the Kyoto Protocol. This was our first act as a newly sworn in government.
Internationally, we are now a ready and willing participant in the process to negotiate an effective post-2012 agreement.
And on the home front, we are now working towards the establishment of an emissions trading system and a 20 per cent renewable energy target by 2020.
Our government's agenda is big and so is our appetite to see real and tangible outcomes - outcomes that help prepare Australia to meet its future challenges.
Pacific Partnerships for Development
One other key part of the new government's agenda is our foreign policy. I am determined for Australia to have good, strong relationships with the countries of the Pacific.
So, yesterday, I released the Port Moresby Declaration. This Declaration symbolises Australia's new approach to the region.
The core of the Declaration is that Australia will begin to negotiate Pacific Partnerships for Development with the nations of the Pacific.
These Partnerships will provide a new framework for Australia and the Pacific island nations to commit jointly to achieving shared goals.
Under the Pacific Partnerships for Development, the Government of Australia will be prepared to provide increased development assistance over time. We will do so in a spirit of mutual respect, mutual responsibility and mutual cooperation.
The Partnerships will embrace:
* improving economic infrastructure and enhancing local employment possibilities through infrastructure and broad-based growth;
* enhancing private sector development, including better access to microfinance;
* achieving quality, universal basic education;
* improving health outcomes through better access to basic health services; and
* enhancing governance, including the role of civil society, and the role of non-government organisations in basic service delivery.
The goal of these Pacific Partnerships for Development is to assist the countries of the Pacific make real progress against the Millennium Development Goals.
I understand that these are long-term goals. But the target date for achieving the Millennium Development Goals is 2015, which is not that far away.
I look forward to Australia and Papua New Guinea working towards a Pacific Partnership for Development.
But we are already doing a lot together. Today I will visit Goroka. Because our Government recognises that there is more to Papua New Guinea than Port Moresby alone - this is big country with diverse cultures and diverse challenges.
One such challenge that I would like to address today is the spread of HIV/AIDs.
AusAID projections for Papua New Guinea on HIV/AIDS infection rates out to 2025 are alarming:
* there are currently between 40,000 and 60,000 people with HIV/AIDS;
* with a business a s usual response, this will result in half a million cases by 2025;
* with a strengthened response, the result will be 350,000 cases; and
* with a heightened response through education, prevention and management the result will be 220,000.
That's why today I am announcing that our Government will commit $13 million in programs towards assisting non-government organisations working right across Papua New Guinea with people affected by HIV/AIDS. NGOs working in this field who will receive support include Save the Children, Anglicare and World Vision.
One of the programs is funding for the Burnet Institute who work with Save the Children, Family Health International and World Vision. Their program seeks to reduce the risks of HIV/AIDS for the most vulnerable members of the community.
Because of the movement of our two peoples in and around the Torres Strait, Australia and PNG have a mutual interest in ensuring that this moves to the top of our bilateral cooperation agenda.
I can also announce today that Australia will increase overall aid funding to Papua New Guinea by up to $25 million in 2008-09. This funding will go to education, health and law and justice support and incentive based payments.
These new funds will be targeted at upgrading schools, doing more in the fight against malaria, and doing more to maintain and upgrade key roads.
Incentive based payments will offer the possibility of more funding once jointly agreed performance criteria are met. These funds could then be used by the Government of Papua New Guinea for further work in areas such as infrastructure.
This is one of the ideas at the heart of the Pacific Partnerships for Development I announced yesterday in the Port Moresby Declaration - mutual responsibility.
When you look at these announcements, you can see that we are already working towards the Millennium Development Goals - health, education and infrastructure are all key elements of our approach.
And, I am very pleased to announce today a series of programs to help develop sports in Papua New Guinea - particularly Rugby League.
This $260,000 package is targeted at enhancing facilities at sports grounds and providing equipment such as boots, jumpers and shorts.
We will provide $50,000 to help around 2000 young players meet the registration costs for playing football.
I am also pleased to announce that I have agreed to a request for the Australian Rugby League to use the title “Prime Minister's XIII” for a match against the PNG national team the Kumlus.
I want to give a real boost to sport in PNG. Helping provide young people with access to sporting facilities and organised sporting activities is a good way for us to send messages about fitness and good health among young people.
Carbon Forest Agreement
Yesterday Prime Minister Somare and I also discussed climate change.
In fact, we did more than just talk about it. We signed the Australia-PNG Forest Carbon Partnership.
It is about us taking action together on climate change. It is an example of us working together on the most important global issue we face.
Under the Forest Carbon Partnership, Australia and PNG recognise the importance of reducing emissions from rainforests as one key element in effective global action against climate change - emissions from deforestation constitute the second-largest source of global emissions after power stations.
With more than 29 million hectares of rainforest in PNG, it is one of the most important countries for this type of activity.
Under this new partnership we will discuss firstly how we can work together to establish sustainable forest management as an integral part of a future international climate change agreement.
Secondly, Australia will provide technical support to PNG in building a satellite based forest monitoring system and means for measuring carbon in forests. This will be an essential ingredient in positioning PNG to participate in future international carbon trading markets.
Thirdly, we will explore opportunities for practical projects to show how international carbon trading arrangements might work on the ground.
The Private Sector
Our Forest Carbon Partnership have a real connection to the business community.
For instance, our work on forest carbon has the potential to generate substantial investment flows into PNG. International businesses seeking to offset emissions increasingly will be looking for credible and verifiable emissions credits, including from forests.
We look forward to engaging with business as part of our cooperation with PNG on forest carbon.
The Pacific Partnerships for Development are also closely linked to business. Enhancing private sector development, including through better access to microfinance and helping build better infrastructure are key areas under the Partnerships - areas that are crucial for broad-based, sustainable economic growth.
The Australian Government is committed to a new partnership with Papua New Guinea. And we hope that the private sector can be a big part of that.
Global and Regional Partners
Just as Australia and Papua New Guinea can work more closely together bilaterally, we can also work together more on regional matters.
The Pacific Islands Forum is the most important of the region's institutions. Its annual leaders meetings set the political direction for the Pacific.
I am committed to enhancing our engagement with the Pacific Islands Forum. In the lead up to this year's leaders meeting in Niue in September I look forward to working with Sir Michael and other leaders in the region.
The region stands to gain a lot from closer integration - particularly economic integration. We will be pursuing negotiations for a region-wide free trade agreement - the so called PACER Plus talks.
As the biggest trading Pacific island nation by far, PNG will be a key partners for us in the negotiations.
I understand the interest in the Pacific in labour mobility as a key part of economic integration. We are looking closely at this complex issue. We are following a New Zealand pilot program very closely and hope to discuss labour mobility at the Pacific Island Forum later this year.
Australia's cooperation with Papua New Guinea goes beyond these traditional areas. At the Bali Climate Change meeting in December, Prime Minister Somare, President Yudhoyono of Indonesia and I discussed climate change.
Cooperation between Australia, Indonesia and PNG has the potential to have a real impact on greenhouse gas emissions, particularly if we look at better forest management.
I believe that Australia and Papua New Guinea have begun a new era of cooperation.
I have no illusions that Australia and PNG will need to work hard - harder than we ever have - to move our relationship up a gear. But I'm also determined that we do so, and that we show the world how two diverse and different nations in the same region are capable of tackling contemporary challenges.
Ladies and gentlemen ...
Our two great countries are linked together through history, through people and through a desire for a better future.
As leader of the Australian Government I will be doing what I can to strengthen those links.
But I also want to ask for your help - the Australians here in Papua New Guinea, the PNG business community, those of you who have studied in Australia, and those of you with links to Australia through links between church and other community groups. I want to ask you to join me in building a stronger relationship between us.
A new partnership that can be a model to the rest of the world.
A new partnership that gets results.
A new partnership that advances the interests of both our nations and our region.
A new partnership that has started today.
Thank you.