In the keynote address Mr O’Neill delivered yesterday at the country’s first ever Petroleum and Energy Summit, he said from the outset, the country remained largely dependent on its extractive industries.
Mr O’Neill said the past few years had been tough for the petroleum and energy sector in Papua New Guinea and around the world with commodity prices dropping from record highs to unsustainable lows.
He said this was on the back of a slowdown in markets like China, and political instability in several parts of the world.
He said in Papua New Guinea, these global pressures saw income drop by around 85 percent in the space of a few years.
"At the height of commodity prices – our Government revenue from this sector was more than K2billion kina a year, and this dropped to K260 million last year.
"This left a huge gap in our national budget.
"But we were careful, we did not lose our grip on the economy and we did not cut essential services to our nation," he said.
He said government had stuck to its guns maintaining its core policies which included health, education, law and justice and infrastructure.
He said government had also undertaken some reforms as a result of the drop in its revenue and in doing so had cut non-essential spending and increased efficiencies in many sectors.
"With a steady hand on the economy of our country – our economy has weathered the storm.
"We continue to enjoy positive gross domestic product (GDP) growth, and the outlook for the coming two years is sound," he said.
The PM said the reports on the economy, and its fiscal position from both the International Monetary Fund (IMF) and the Asian Development Bank (ADB) also remained positive on its outlook on the economy.
"They (IMF and ADB) are tough in their reviews, but agree that we are on the right track.
With improvements in the global economy, and the rebound in commodity prices, we can see positive change taking place.
"We are not out of the dark yet, but there is light ahead," the PM said. Post Courier/Media Statement/PNGfacts