Economy SME

Why family owned businesses must be supported by the #PNG Government


Our economic investment model as it relates to job creation is wrong.  We have had it wrong for nearly half a century.   We followed a colonial model of job creation where an enterprise is established, jobs are created and people get a paid job.

Many employers wonder why people don’t stay in a job for a long time especially if the factory or shop is near a village.  Many foreigners are of the assumption that people living in villages want jobs. Maybe some do for status.  But most get bored with the stressful routine.

In the case of the RD Tuna Cannery in Madang. The cheap labor comes from settlers who have to work for a living because they have to.  How many locals are employed?  Not as many as the settlers.  Many have  said they only go and work at the cannery if they need money to buy a fishing net,  a boom box or a guitar.  Then they go back to their villages after they get paid.

It’s still happening.

This is primarily because their basic needs of food, water and shelter are taken care of. They live on the land. They plant food.  Many treat cannery work like a food  garden that doesn’t need to be cared for.

Papua New Guineans are traders and entrepreneurs who live in an economic environment that doesn’t support their natural talents. The earliest contact that people on the Island of New Guinea had was with Malay  traders.  People along the Port Moresby coast traded with people in the Gulf Province.

The ‘Take Anda,’  the cultural center in Enga Province contains  archaeological evidence of  trade relations between the Engans, the Hela and the Western Highlanders.  Shells  from the coast are kept  in the building.  It is  part of a puzzle of the multitude of cultures in Papua New Guinea that has not really been understood by this generation.

Yes, we are warriors. But we are also traders and entrepreneurs. This activity consumed a large part of daily life in the past.

The most important point here is that the family unit held the shares to that community enterprise.  The family contributed and got its returns.

We still do it.

We do it during funerals, bride price payments and university fee payments.  The business model does not really work unless a whole family is involved.  The application of that formula continues to be applied in the highlands with success.

Papua New Guinea’s are ‘bad’ workers in restrictive 9am to 5pm environments.  But when given  the creative space and when given a purpose along with family support,  small businesses can grow into big enterprises.

In Meteyufa, Eastern Highlands Aku Kulo a kaukau farmer,  runs a kaukau export business.  He ‘employs’ at least one member of every family not in the  business.  Everyone works on the land. Every family gets paid up to K1000 per week.  If you want more money you work some more. The only restriction is the land boundaries.

Family businesses solve multiple social and economic challenges.

They can employ whole villages.  Family business help pay for school fees, hospital and funeral expenses.  These are the same requests that foreign bosses get and can’t understand why the employee comes to them for assistance.

In a family business, housing, food and transport is almost always provided.  Individuals eat  at the same household after work. The young boys sleep in the ‘big’ house.  Married family members have their own homes.  They benefit from the psychological support.  Unemployment in the western sense is reduced to zero.   People remain connected to their families.

Twenty-something-year-olds working with an uncle or older cousin in a business are allowed to go see their parents when they need a coffee plot picked.  It’s understood, no questions are asked. They don’t get threatened with a pay cut

That is the kind of employment environment that Papua New Guineans thrive in. A young man or woman will leave paid employment to work in a family business for less pay because it offers that kind of support.

The Family Business  should be a category recognized by the Investment Promotion Authority (IPA), the Internal Revenue Commission (IRC) and the National Government. It should get special incentives like lower registrations fees and 20 year tax holidays  so that families are able to send their children to universities.

The  Papua New Guinea Government should be developing generations of entrepreneurs instead of encouraging investments that ‘gives us jobs.’

Those kind of jobs don’t work for us.



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