PNG OPEN BID PROPOSAL CALLED UNFAIR

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Government projects too big for local contractors

By Barnabas Ordre Pondros PORT MORESBY, Papua New Guinea (The National, August 28, 2009) – THE Government’s proposed public-private partnerships (PPP) policy has been described as unfair and one that denies Papua New Guinean firms the opportunity to compete for contracts and is exclusively foreigner friendly, says prominent lawyer Peter Donigi.

"What the Government is doing through the PPPs is to create an exclusive opportunity for foreign companies to compete for contracts without substantive competition from local companies," Mr Donigi said.

He said the PPP policy would grapple Papua New Guinean firms, leaving them as mere spectators.

"Under the PPP policy’s competition approach, infrastructure services which may have been delivered exclusively by a public service provider will be available for private provisions," Mr Donigi said, noting that it would only apply to projects worth more than K50 million.

He said the PPP had worked well in countries with large domestic firms that could compete in the market place for contracts but that was not the case in PNG.

"Unfortunately, from experience, there are no PNG owned firms that are large enough to compete in the market place," he said.

"There will be stringent requirements for any competitor such as bank guarantees and capacity to perform or undertake the contracts".

Mr Donigi asked whether there was any policy in place to facilitate participation by PNG owned companies and they did not seem to have any answers.

He said that PNG as a member of WTO was required to open up its market to international competitors by 2020.

As such he asked whether "there is any government policy in place to facilitate development of internal capacities and companies which will compete openly come 2020".

Mr Donigi said he believed the Government should look at creating a policy "to give positive and constructive preference towards PNG owned businesses before 2020".

This is so as to prepare PNG firms for the open competition when PNG firms are required by international law to open up its market.

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