In an address to Australia's National Press Club, on Wednesday, Mr O'Neill called for a total re-alignment of the Australia's half-a billion dollar a year aid program to support the PNG government's priorities.
Those priorities include unprecedented new spending on roads, ports and airports.
After talks with Prime Minister, Julia Gillard, Mr O'Neill told Jemima Garrett he hopes to see some response from Australia as soon as next week's meeting of the two countries joint Ministerial Forum.
Presenter: Jemima Garrett
Speaker: Peter O'Neill, Prime Minister of Papua New Guinea
O'NEILL: We are trying to focus the Australian aid program to some of our development priorities in the country. We have set out specific priorities through our budget that we have just handed down. We have stressed to the Australian government that rather than having the aid program running in a parallel system, we must have a sustainable implementation of this together with the Papua New Guinea government. And the priorities that our government has set, they must come in partnership with us because we are funding some of these projects ourselves. So I think it is better managed if we do it together and it is feasible and it is achievable. So I am certain that the Australian Prime Minister and the government acknowledges that and our talks with the Ministerial Forum in Port Moresby will take into account many of the concerns that we have expressed and hopefully, that will be settled by next week.
GARRETT: Papua New Guinea is planning to borrow 6 billion kina, which is about 2.7 billion Australian dollars from China's Exim bank for infrastructure projects. If Australia was to put in more for infrastructure, would that reduce the need for that debt, the scale of that debt?
O'NEILL: Six billion is a figure Papua New Guinea has requested the Chinese government, through its Exim Bank, to provide a facility of up to six billion. That does not necessarily mean we will borrow six billion. We will borrow to the standards that we will be able to deliver. We have capacity issues in the country. If we borrow six billion in any given year we cannot manage it. We will stagger that out over time to develop the infrastructure needs that we have. Certainly, if the Australian government though its aid program intervenes in some of the [priorities that we have got, of course, the need for borrowing such an amount will reduce. We are not necessarily going to borrow everything that we are asking for. We will prioritise it. We will carefully manage the debt levels that we have in the country and making sure that the borrowings go to impact projects which are of National interest.
GARRETT: PNG has a $53 million loan to allow the Chinese company, Huawei, to provide assistance to PNG's Integrated Telecommunications Service, which includes sensitive areas like visas and tax. Some PNG bureaucrats have suggested that that leaves PNG government information vulnerable. How do you respond to that?
O'NEILL: I don't necessarily agree with some of the concerns that our bureaucrats are raising but we have through the contract, we have maintained obligations that Huawei needs to do, the sort of information that they are entitled to receive does not necessarily include security issues of the country. The sensitive information systems network system for sensitive agencies of government is going to be separated from the total broadband network that we are now trying to roll out to the country. So we are managing it through an independent assessment process, where an independent team will manage the contract on our behalf, and many of them are ex-Telstra employees out of Australia, who are managing the roll-out of the NBN roll-out that we are now embarking on in Papua New Guinea.
GARRETT: So national security will be separate from that contract? Is that what you are saying?
O'NEILL: Precisely, yeah!