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Near Neighbours – PNG: New Fault-lines in the Tropics

By Denis Bright

With its surging population growth, economic volatility and internal income divide, many of our neighbours in Papua-New Guinea (PNG) are having difficulty coping with the everyday challenges of globalization.

Official economic growth rates are artificially elevated by the commercial export sectors in oil, natural gas, minerals, timber products as well as traditional plantation crops like coffee from small and middle-sized holdings. This volatility is reflected in data for economic growth from Trading Economics.

The Lowy Institute highlights the negative outcomes of this volatility:

On three occasions since independence, the PNG Government has sought external assistance from the International Monetary Fund (IMF) and the World Bank to address unsustainable pressures on the external accounts fuelled by budget deficits … Under an IMF Standby Facility, the Fund stands ready to directly lend foreign currency to PNG’s Central Bank to bolster its holdings of external reserves, thereby enabling the Bank to manage the imbalance in foreign exchange demand and supply in a more orderly fashion.

PNG Treasury has extended economic growth projections to 2022 to assist with preparations for the 2018 National Budget. No major growth spikes are expected soon.

Historically, PNG Coalition Governments were vulnerable to compromising financial and strategic offers from developed countries. Some offers were irresistible in the short-term.

To its credit, PNG has stuck to its membership of the Non-Aligned Movement (NAM).

The stability of the centre-right government of Prime Minister Peter O’Neill has increased PNG’s independence and confidence. However, there are some inherited policy ghosts from previous national administrations.

Vulnerability to Developed Countries Being Gifts to Neighbours in Our Near North

In 2001, the under-utilized PNG naval base at Los Negros just off Manus Island became a new dark industry for a struggling PNG economy. The establishment of the detention centre carried a message about Australia’s preferred economic model of development. Management of Manus Island Detention Centre was awarded to Transfield Services and then the Spanish multinational company, Ferrovial. Eventually, both the PNG Government and High Court intervened to demand the closure of the Detention Facility.

Without any assistance from that Mythical Crystal Ball, it is highly likely that more interference with the sovereignty of PNG will continue. PNG is a prized asset with the diversity of its resources and a strategic geopolitical location.

The Australian assisted in talking up interest in Manus Island both as a detention centre of asylum seekers and the possible site for a re-activated US Defence and communication installation:

The RAN and foreign navies, including the US Navy, used HMAS Tarangau extensively as a fuelling stop for ships transiting between east Asia, Australia and elsewhere in the South Pacific.

Australia should increase its maritime presence in the archipelagic arc to our north. RAN’s use of Manus would greatly facilitate that presence.

As well as naval facilities, its Momote airfield would be a valuable base for Australian and allied maritime surveillance aircraft.

The US is interested in new bases in the Pacific. At the same time, the island countries are looking to the US to demonstrate that it appreciates the importance of the Pacific islands region in Washington’s rebalance policy towards Asia. Manus could be an option.

PNG is now assuming a South Pacific regional leadership role. Trilateral negotiations could be opened now between Australia, the US and PNG regarding access to Manus as a forward operating base for maritime forces.

Strategic interest in PNG extends far beyond conventional military installations. The SMH noted the importance of the Near North to Australia’s global intelligence priorities:

Australian intelligence sources recently confirmed to Fairfax Media that Australia’s electronic espionage agency, the Defence Signals Directorate, is a “full partner” in the program, which they said, “overwhelmingly harvests diplomatic, political and economic intelligence, not just information relating to terrorism and security”.

Fairfax Media revealed in August that Singaporean intelligence is in partnership with the Defence Signals Directorate in operations to tap undersea fibre optic telecommunications cables that link Asia, the Middle East and Europe.

The government of Peter O’Neill is outspoken against this unauthorized surveillance of domestic communications which can be used to compromise sensitive negotiations between PNG and multinational companies involved in negotiations over the use of local resources.

PNG displayed its spark of independence by joining with New Zealand to endorse the 2017 UN Treaty on the Prohibition of Nuclear Weapons. Unlike Australia, most NAM Countries in Asia and the Pacific also made this commitment to opt out of the excesses of the global arms race.

When sensitive international issues like recognition of Palestine or clearance for vessels carrying nuclear weapons close to PNG and its neighbours are being discussed, it is important of global intelligence agencies to sound out local political opinion in NAM states or countries which are flexible to international lobbying towards the attainment of favourable pro-western voting patterns.

Developed countries are less concerned about the alarming social indicators in PNG society.

This country is in no position to integrate asylum seekers as part of the Pacific Solution. Our veto of immigration offers from the Ardern Labour Government is callous to say the least.

Social Indicators in Australia’s Near North

Some of the presenting social indicators from PNG and other countries to our Near North are appalling (Asian Development Bank Online (ADB) 2017). From poverty levels to infant mortality and even access to electricity, PNG is no regional beacon of social justice. The data will shock most readers. It would be trite to summarise the grim social statistics selectively. They are readily available online from the ADB site.

Demanding tropical ecosystems make higher level of self-sufficiency in food production an ongoing challenge. Food production must compete with export crops for a current population of around 8.4 million which would double every 35 years at current rates of net annual population growth (+2.1 per cent).

In the PNG Highlands, droughts or unseasonably cold weather can ruin staple crops. Hunger is commonplace with medieval levels of associated health scourges like influenza, tuberculosis and measles.

To this unsavoury brew has come the latest earthquakes in the PNG Highlands:

Papua New Guinea faces a long road to recovery after the powerful earthquake that hit the nation’s rugged highlands more than 10 days ago, with the death toll now believed to have climbed to more than 100, its leader said.

Australia and New Zealand sent more helicopters and planes to help deliver food, water and medicine to the remote region, where the Government and aid agencies have been scrambling to reach villages stranded by landslides and collapsed roads.

“Tragically, the Highlands earthquake has already claimed the lives of an estimated more than 100 Papua New Guineans, with many more still missing and thousands of people injured,” Mr O’Neill said in comments published by his office.

The quake forced oil giant ExxonMobil Corp to shut all its gas facilities in the country, which it expects will be down for about eight weeks while it carries out inspections and repairs.

Despatching enthusiastic Australian defence personnel to such crises is highly appropriate.

Agencies say access to the affected areas remains an enormous challenge. Initial reports and aerial assessments reveal that 65 per cent of health facilities are closed and schools have been damaged to such an extent that authorities are considering cancelling the entire school year.

According to United Nations’ indicative estimates, of the 211,000 people who live in the area, about 143,000 need urgent humanitarian assistance.

The area has been wracked by tribal conflict, and most of the earthquake-affected areas are also in drought, reducing crop production and the resilience of communities.

Agencies such as the PNG government, UNICEF, the World Health Organisation and UN Women, are focusing on treating children with severe acute malnutrition, as well as focusing on children’s safety, hygiene and medical supplies.

Foreign minister Julie Bishop said on Wednesday the Australian Government was increasing its humanitarian support to the stricken country.

Three Army CH-47F Chinook helicopters will deploy to PNG this week, Ms Bishop said, with additional defence personnel and supplies to support the relief effort.

“This contribution adds to the existing presence of 80 ADF and 75 AFP personnel in PNG,” she said in a statement.

Management of the humanitarian crisis has been complicated by local perceptions that oil and gas exploration has contributed to the historical frequency of earthquakes in Hela Province of PNG (SMH Online 7 March 2018):

Reuters made this assessment of crisis:

A deadly earthquake that struck ExxonMobil’s $19 billion gas project in the mountains of Papua New Guinea is sparking a backlash against the U.S. energy giant that could prove harder to fix than buried roads and broken pipes.

Some spooked locals blame Exxon (XOM.N) and its project partners of causing, or at least magnifying, the 7.5 magnitude quake on Feb. 26 and a series of intense aftershocks that continue to pound the impoverished and isolated region.

While firmly denied by Exxon and debunked by geologists, the accusations suggest that the project known as PNG LNG, one of the most successful liquefied natural gas (LNG) developments in the world, is sorely lacking goodwill from at least parts of the local population.

The concerns about the project – the country’s biggest revenue earner – are even being expressed at senior levels in the Papua New Guinea government.

PNG’s Vice Minister for Petroleum and Energy, Manasseh Makiba, told Reuters in a phone interview there should be an inquiry to respond to local concerns that Mother Nature had reacted after the ground was disturbed by drilling.

Official assistance from Australia’s AusAId is on its way but PNG could benefit from a refocusing of Australia’s defence and foreign policies towards our immediate Near North.

As the federal LNP talks up a higher profile for Australia in international affairs, a new executive office in the air is being assembled in Spain for Prime Minister Turnbull for those cosy diplomatic visits and occasional inspections of Australia’s overseas defence training programmes.

The cost of the plane and its refit amount to $248 million with work being completed in Spain before the aircraft joins the RAAF’s VIP fleet (ABC Online 5 March 2018). Cheers to Labor’s Senator Kimberley Kitching for her responsible questions at the Senate Estimates Committee about the costs of refitting of a KC-30 tanker for service as a mobile office. The costs of this aggrandisement exercise should be compared with the AusAid Budget for PNG.

Future generations must decide if Australia needs to aspire to strategic geopolitical greatness by assisting the US Global Military Alliance in applying balance of power strategies across the entire Indo-Pacific Basin. Too much partisan military hardware in Australia’s Near North threatens a half-century of reasonable strategic stability since the formation of the Association of South East Asian Nations (ASEAN). PNG, Timor-Leste and Vanuatu aspire to join this non-aligned ASEAN Bloc.

Encouraging PNG and other Northern Neighbours to move in more militarized directions with potential new defence and communication bases are likely to be counter-productive moves. A high level of historical underdevelopment is the key regional destabiliser with its embedded future security risks. This problem is not tackled by the acquisition of more regional military hardware to the glee of global military industrial complexes with scant interest in improving PNG’s social justice indicators.

Denis Bright is a registered teacher and a member of the Media, Entertainment and Arts Alliance (MEAA). Denis has recent postgraduate qualifications in journalism, public policy and international relations. He is interested in advancing pragmatic public policies compatible with contemporary globalization.



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  1. diannaart

    Excellent work, Dennis.

    Too much partisan military hardware in Australia’s Near North threatens a half-century of reasonable strategic stability since the formation of the Association of South East Asian Nations (ASEAN). PNG, Timor-Leste and Vanuatu aspire to join this non-aligned ASEAN Bloc.

    Unfortunately, I believe this may continue.

    Encouraging PNG and other Northern Neighbours to move in more militarized directions with potential new defence and communication bases are likely to be counter-productive moves.

    More military and less humanitarian involvement does not result in a viable and sustainable democracy in any country let alone Australia’s near neighbours.

    Humans appear destined to learn AFTER the fact – then forget what they’ve learned and start over again – with the authoritarian types rising as leaders yet again.

    Breaking this circular behaviour is unlikely to change given Australia’s utterly spineless government, the violent tendencies of significantly influential leaders both to the north and across the pacific.

  2. Moira

    I agree with diannaart. This is also a very topical article with the ASEAN Summit in Sydney.

    ASEAN has ten member states and priority should be given to new membership from developing Asian and Pacific States outside the American Military Alliance.

    ASEAN must not become a Cold War 2 Alliance against China and Russia as with SEATO that was phased out with the formation of ASEAN.

  3. Pat

    A well argued case for a new direction in our foreign policy and development assistance programmes.

  4. Leila Smith

    Couldn’t agree more Denis.
    Australia needs to support PNG socially & economiclly. If we continue to fail to do this it will backfire on Australia as poverty ,unemployment etc leads to civil unrest.
    We should not forget our close PNG is to our Australian border and for us to be friends & supporters is much more beneficial than enemies.

  5. James Robo

    Are Malcolm Turnbull and Peter Dutton wanting to turn ASEAN into a military alliance?

  6. Tessa

    Cheers to ASEAN’s peaceful agenda: PNG deserves to be a member state!

  7. Stella

    Denis, how does Australia justify a boundary line that runs so close to the PNG border?

  8. Paul

    Thanks for the insights Denis!

    We should help PNG with more foreign aid and also in kind support!

  9. Kyran

    There are so many ‘conflicted’ aspects in the way Australia treats its northern neighbours generally, and PNG specifically.
    From a ‘defence’ point of view, we are inextricably linked to the US through the Pine Gap facility, which we only have limited access to. This is the largest spying facility in the southern hemisphere and its very existence is an impediment to any considered foreign policy development, particularly when it is not even referenced in most such discussions. Only this government would allow the lease of a port to the Chinese so close to such a ‘sensitive’ installation.
    The Chinese are expanding their influence far more quickly through their use of the ‘One Belt, One Road’ infrastructure spend than their military expansion through the South China Sea. And PNG is no exception.

    “The announcement of the deals comes amid warnings from the Opposition that Australia is risking losing influence to global powers, particularly China, because it has failed to live up to its leadership role in the Pacific.
    Shadow defence minister Richard Marles gave a speech today at the Lowy Institute in which he stressed that the Pacific is Australia’s “biggest national security blind spot”, and added that fears of being an “overbearing colonial power” are wrongly holding us back from effectively engaging with Pacific countries.”

    Our narcoleptic government, forever asleep at the wheel, is reliant on the pseudo Immigration and Border Farce Miniature, Michael Pezzullo, to formulate a strategic policy in response to the Chinese policy.

    “At the start of this year federal ministers closely examined and rejected a Chinese investment proposal which linked the Government’s plans for northern Australia to the Belt and Road Initiative.
    Several Government sources have confirmed Immigration Department secretary Mike Pezzullo and then Defence Department boss Dennis Richardson warned against Australia joining the project because of “strategic” concerns.”

    That’s the same Michael Pezzullo that is up to his ears in our involvement in PNG through conflicted use of various programs. Conflicted in the sense that we spend $546mill in ‘aid’ to PNG, of which we allocate 43% to ‘effective governance’, yet contract with them to the exclusion of ‘effective governance’.

    How could you contract for ‘effective governance’ whilst ignoring the decisions of their Courts in declaring our warehousing of refugees as illegal and unconstitutional? Not to mention that the Australian government spending on the detention facilities is predominantly through Australian companies, not through local businesses. This has been integral to the hostility between the indigenous Manus islanders and the prisoners they are forced to live with.

    “It was the fourth blockade in recent weeks. Previously barricades were erected to demand that local contractors, rather than Australian-based firms, be awarded the multi-million dollar contracts to operate and guard the camps, and for compensation for the damage and disruption caused by them.
    Referred to as “landowners” by the Australian media, the local people come from communal villages where different kin groups have customary land tenures granted by the Papua New Guinea (PNG) government. The Australian and PNG governments have deliberately sought to whip up animosities between impoverished villages and refugees, who have been incarcerated for years then dumped in inadequate accommodation.
    Behrouz Boochani, an Iranian refugee and journalist imprisoned on Manus Island, was nevertheless sympathetic to the plight of villagers and blamed the Australian and PNG governments for the intolerable conditions.
    “The local people are complaining about the hygiene situation because it is making people sick. The new camps are very close to small villages and make the life hard for people there. It’s a problem created by the government and the government should take responsibility,” he said.”

    The biggest problem we have with our northern neighbours in general, and PNG in particular, is that those nasty ingrates seem to think they are something other than our colonial outposts.
    We can’t have that now, can we?
    In our outdated belief that we are superior, we will ignore the fact that they can think for themselves and that accepting aid from China may have less conditions than accepting aid from colonial masters living in a soon to be forgotten past.
    Thank you Mr Bright. Take care

  10. diannaart

    Labor’s stand on Climate Change policy, while less than reassuring, is about the only alternative to the business-as-usual LNP.

    Australia will become the USA of Southern Asia/Pacific while its federal government continues its game of prevarication – ignorant, self-centred and callous.

  11. Denis Bright in Brisbane

    Thanks diannaart. Political participation is not very great in Australia. That is the heart of the problem. Politics has become too bipartisan. Which government made us associate members of NATO and continued with the Pacific Solution that assisted Howard to win the 2001 election? AIM Network strives to promote political participation between elections when LNP policy frames are largely communicated through news and current affairs programmes. The decline of trade unionism is also a big negative for political participation. I am pleased to be a member of the MEAA. I should attend more of its activities in Brisbane.

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