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.
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