Friday, July 22, 2016

Time to heal and build a better #PNG

A man and woman seen at Local Dressers Service Station, Ialibu, Southern Highlands Province

Today I was disappointed. Not because the Opposition didn’t win the Vote of No Confidence, but because of the lack of a better alternative to the status quo.

I’ve noted how some have demonized the Speaker of Parliament for quelling debate but let’s be realistic - the Opposition did not have the numbers on the floor.

Many commentators may have their opinions on why the status quo wasn’t changed. To my mind, change did not occur because there was no better alternative. Change did not happen because the whole of PNG wasn’t inspired by a better alternative, to move for change.
The challenge presented to the Opposition and critics of the current government is to articulate a better alternative that everyone (including the crooks) can believe in.
The default attitude that some may take following the failure of the Vote of No Confidence may be to create further obstacles. Whilst this may generate headlines and cause disruptions, as we have seen from previous experience, such efforts have been futile. Indeed, ordinary Papua New Guineans have paid are high price without a single dent on the current regime.
Now is not the time to further polarize the country but to heal the wounds and build bridges. Now is the time for more moderate voices articulating a better alternative? One cannot bring about change using the same methods that have failed previously.
Our people want change but its not just the change of personalities but a holistic change that improves their livelihoods and wellbeing. Such change does not just come from removing a Prime Minister but from redefining Papua New Guinea’s model of development. It’s about social, economic, political and cultural reforms that create an inclusive and just society.

Critics of the current regime have been experts at highlighting its sins but have yet to convince the people of Papua New Guinea how they can lead the country into a brighter future.

Sure we have over-crowding in classrooms but how do we address the issue without borrowing to build more infrastructure? Do we increase government spending by building more hospitals and buying more medicines or do we empower our people to prevent themselves from getting ill?
To replace some individuals with other individuals without redefining the underlying model of development is a band aid solution.  Wholesale changes to the philosophy of government, investments in human capital and institutional reforms are needed alongside changes to faces.

Yes we can talk about the abuses and terrible things our nation is going through but we must also give our people hope about the future. We must empower our people so that they themselves are capable of participating meaningfully in all aspects of national development so as to maintain national sovereignty and promote self-reliance.

Our people don’t just need stories about how bad things are in PNG but also empowering stories about Papua New Guinean ways of achieving sustainable human development and creating a nation they can be proud of. 

Monday, July 11, 2016

Somare and Mekere propose rescue plan for #PNG

L-R: Rt Hon. Sir Mekere Morauta and Rt Hon Grand Chief Sir Michael Somare


Today Papua New Guinea is at a turning point.

On the one hand we can choose to start afresh with new leadership, new vision and new hope for the future.

Or we can continue down an uncertain, slippery road, led by a person who is increasingly behaving like a dictator, with total disregard for the law.

As former Prime Ministers we have made our choice, and we ask our fellow Papua New Guineans to join us in rescuing our country.  We cannot, through inaction, see our democracy and the institutions that support democracy ruined.  The nation’s future is at stake.

Today we are declaring that the Prime Minister must stand down, for the good of all Papua New Guineans.

Mr O’Neill has brought the nation to its knees – socially, economically and politically – and he cannot be allowed to do more damage. His countless lies to trick the public that our country is sailing along smoothly are a deceitful display of moral corruption.  The fact is we are trapped, and sinking.

 We have decided to speak out and urge all Members of Parliament to support a change of leadership and commence a national rescue effort.

Mr O’Neill should ensure there is a smooth and rapid handover of the Prime Ministership by recalling Parliament immediately and resigning, so that Parliament can elect a new Prime Minister. 

This is the only way to end the division and chaos that Mr O’Neill has fostered, and to bring an end to the violence, bloodshed and discord that have resulted from his leadership.

Mr O’Neill has demonstrated he has no capacity or intention to restore national unity, or to lay a strong and fair foundation for sustainable growth of the country.

Only a new Prime Minister with a new approach can do that, which is why we are supporting change of leadership.  Both of us are committed to assist where we can in the difficult but necessary task that lies ahead.

The past five years of Mr O’Neill’s leadership have been characterized by mismanagement, waste and corruption on an unprecedented scale.

Papua New Guinea under Mr O’Neill is trapped in a circle of financial and economic woes. The answer is not more borrowings, which is what Mr O’Neill has chosen.  More unconditional borrowings are just band aids on a tropical ulcer; more borrowings will just tighten the trap. 

The country’s social fabric is being torn apart.

Institutions of state, including the judiciary, the Bank of Papua New Guinea and the police, are being politicized, attacked and incapacitated.

Mr O’Neill has perverted the Constitution and Laws of Papua New Guinea. The Public Service and state enterprises have been used as Mr O’Neill’s personal belongings, to be ordered about with complete disregard for processes, propriety and accountability.  The systems and processes of government have been undermined and willfully bypassed, with the result that the machinery of state barely works.  The Public Service has been paralysed by a lack of operational funding.

Students are being shot at and treated like criminals, universities are closed, the police and defence forces are fractured, and social and economic conditions in rural and urban areas are deteriorating. 

The rights of ordinary Papua New Guineans enshrined in the Constitution have been trampled on – in particular the right to free speech and the right of assembly for legitimate purposes. The media has been subject to threats and intimidation – and, on occasion, actual physical violence.

Mr O’Neill has shamelessly abused the Office of the Prime Minister and brought it into disrepute. Papua New Guinea’s international reputation and credibility have been trashed.

The nation cannot afford one more moment of Mr O’Neill’s Prime Ministership.

A home-grown rescue plan must be developed and implemented as soon as possible, using expert and independent advice from our best talents and with the assistance of our international friends and multilateral partners.

In our view, it is in the national interest to make this change.

Wednesday, June 29, 2016

Why MRA should not approve Wafi-Golpu and Frieda River mining leases?

There is a Papua New Guinean weakness known in tok pisin as “yumi ol lain blong saik up nating.” Translated into English it can mean several things but in the context of this blog it refers to Papua New Guineans making irrational decisions based on the state of their emotions.

Environmental arguments aside, PNG 's Mineral Resources Authority (MRA) should not grant special mining leases to the developers of these projects as it (PNG) is currently in a weak negotiating position.

It may seem counter-intuitive not to grant licenses at a time when PNG’s economy is in crisis. Foreign direct investment from these two projects would provide relief to our foreign exchange woes. The two projects will also provide much needed jobs during the construction phase.

But the experiences of Ramu Nickel and the PNGLNG Project should serve as a stark reminder to politicians and bureaucrats. Both deals were closed when PNG was in a weak negotiating position and as a result the government, landowners and people of PNG have gotten rotten deals.

Ramu Nickel was negotiated by the Somare government at a time when no one was putting any money in PNG’s oil and gas and mining industry. The PNGLNG project was negotiated around the time of the global financial crisis. With the PNG government in a weak negotiating position, the Chinese and American shoved their contracts down PNG’s throat and made the nation swallow their bitter pills.

The consequences have been disastrous for local people and the national economy. Landowners at Ramu Nickel have not being paid a single cent of royalties, according to PNG’s EITI Report for 2013. The PNG LNG gas pipeline runs past various stranded gas fields that cannot be exploited to grow a local petrochemical industry because the state failed to negotiate for a common carrier pipeline. Various other ills can be listed for both projects.

The announcements by the partners in the Wafi-Golpu and Frieda River projects come at a time when PNG is facing economic difficulties. They (announcements) also come at the eve of the general elections when a cash strapped government is keen on pleasing the electorate with its economic credentials. It seems the project developers also believe as some industry players do that the mining downturn has bottomed out.

As previously pointed out by Prime Minister O’Neill and the Chief Secretary, PNG is a price taker and so it’s susceptible to market fluctuations.

However the nature of the commodities markets is that they are cyclical as the market corrects itself to changes in supply and demand.

If the pundits are correct that the end of the downturn is in sight, PNG can afford to sleep on the Frieda River and Wafi Golpu licences. The global uncertainty caused by Brexit is good for PNG’s gold miners as investors see gold as a safe haven and push the gold price up. And a general upswing in the resource sector is anticipated.

The narrative of the O’Neill government has been one of “nation building” is exemplified by its large infrastructure projects. As a government focussed on nation building, it should reject the special mining lease applications if they do not include refining of the copper and gold mined. As the PM and his Chief Secretary may well be aware, PNG cannot continue to be a price taker.

Economic diversification and industrialization of PNG can begin with the downstream processing of the ore from Frieda River and Wafi Golpu. PNG needs to capture more of the value of its natural resources given its close proximity to markets in Asia. The Wafi Golpu and Frieda River projects present an opportunity to transform PNG from being just a price taker.

Finally, PNG should not rush into granting special mining leases to both projects until the proposed amendments to the Mining Act are made. This is imperative given the Kumul Consolidation agenda should PNG choose to give Kumul Mining a greater stake in both projects.

As a nation, we need to capture more value from our natural resources or risk repeating a 40 year legacy of lost opportunity and squandering of natural resource wealth.