By Andrew Hobbs, Group Editor

A REPORT prepared by Australia’s Lowy Institute for International Policy puts in stark terms what has been a major challenge for the Papua New Guinean government in recent months.

“The popular assumption that consistent ross domestic product growth is a critical driver in national development has proved to be flawed in the experience of Papua New Guinea.”

Entitled Papua New Guinea in 2015: At a Crossroads and Beyond, the report said the PNG Government had found it difficult to spread the benefits of the boom.

In part, the report reflected on the fact that the nation is unlikely to meet any of the United Nations’ Millennium Development Goals (MDGs) in their deadline year.

Papua New Guinea is far from alone in falling short of the standards, and Prime Minister Peter O’Neill raised his concerns at the 7th Pacific Islands Leaders Meeting (PALM 7) in May.

“The Millennium Development Goals should not be seen as a one-size-fits-all approach,” he said.

“Papua New Guinea continues to have challenges in meeting the MDGs as defined in the global criteria – but we are seeing real development in our country through the implementation of core development priorities… in education, healthcare, security and infrastructure.”

There has been success in these areas – the government puts school attendance figures at roughly 2 million children, almost twice as many as before, while healthcare is also said to be improving.

But the Lowy Institute suggests there is more to the story – while more students are attending schools, the schools themselves are struggling to cope with numbers.

This is a problem that extends from early childhood education up to universities and even in seeking formal sector employment.

“The government’s support of large resources projects at the expense of the small to medium enterprise (SME) sector has not helped to create the formal sector jobs young people are demanding,” the report said.

Growing the SME sector is also a priority for Mr O’Neill, who told the Papua New Guinea-Australia Business Forum that while the entrepreneurial spirit was strong, other factors had let small businesses down.

“We have implemented a comprehensive program that includes affordable finance, providing advisory services, training support and reducing red tape on approval processes,” he said.

“We will continue to engage with small business and to clear bureaucracy so that our SMEs can thrive in our country.”

This approach is worthy of praise, but it must be followed through – the creation of new small businesses will help to sustain a workforce through the commodities cycle.

In turn, it will fund government services Mr O’Neill aims to bring to the people.

That, after all, is a goal worth reaching.