Sovereign Wealth Fund Bill Passed in #PNG

20 12 2011

By Dora Gawi of FM 100

The Constitutional amendment to the Sovereign Wealth Fund Bill was passed this afternoon in parliament with a majority vote of 73 to nil.

Prime Minister Peter O’Neil when presenting the bill for its first vote in Parliament this afternoon says the Bill allows for the establishment of the Sovereign Wealth Fund where monies from the resource boom in Papua New Guinea will be managed prudently with best practices, whether it be on shore or off-shore.

Prime Minister O’Neil says the Sovereign Wealth Fund will constitute a Stabilization fund as well as an Infrastructure fund.

The amendment see the future generation fund disposed off, as previously brought forward by the Somare-Abal regime when they were in Government.

Mr. O’Neil says this fund will ensure deposits and withdrawals are in line with laws of the country and are transparent, where an independent board will be set up to oversee the fund.

The vote today saw three members from the Somare regime member for Nipa-Kutubu Philemon Embel, Member for Kabum Bob Dadae and Member for Kerowagi Guma Wau turn up to vote in favor of the Bill as well.

The amendment and voting today was necessary as required by Constitution to see that it becomes operational.

…ero

Meanwhile the Women’s Reserve Seat Bill again failed to muster the numbers required for it to be passed. 

 





Donigi opposes Sovereign Wealth Fund

1 12 2011

In March 2010, the Department of Treasury and the Bank of Papua New Guinea established a Joint Working Group to look into Sovereign Wealth Funds (SWF) under the directive of the National Executive Council. This undertaking was made by the government to look into managing the expected windfall returns from the LNG project as well as other resource extractive industries.

Some have hailed it as a step in the right direction. However, senior lawyer and statesman, Peter Donigi has come out to the media (‘Focus’, The National  29/11/11) in opposition to this proposition. Key among his points is the fact that the establishment of a SWF has gone ahead without much public debate on the matter.

A soft copy of his statement was not available for publishing on this site so a scanned copy of his statement has been made available here instead. You can also download the PDF of the same here.





Poverty: the very poor tend not to rise up

13 04 2011

By: Paul Barker | 13 April 2011 at 05:48 PM

As Fr John Glynn said recently: “I cannot understand how the PM says there’s no poverty in PNG; I can see it every day in Port Moresby”.

PNG has little excuse for poverty but – like oil, copper or gold rich countries in Africa – benefit-sharing has been poor, and seems to have become worse, denying broad-based opportunities.

One of PNG’s great attributes has been broad-based access to land resources and generally suitable climate/reliable rains which have avoided the extensive starvation seen in parts of Africa (and south and east Asia in the past).

But even that’s being jeopardised now with land scams which would deprive customary l’owners of their land with 99 year business leases (SABLs) as well as displacement around mines etc.

There is poverty and a lack of access to markets and essential services deprives[sic] people of opportunities and life; (the very high and unnecessary level of maternal and child mortality in PNG – about the highest in Asia-Pacific is just one demonstration of poverty).

Now is a testing time: PNG’s already wasting great opportunities as a result of grand misuse of public funds, but will it let LNG and other new natural resource developments contribute to its citizens opportunities (including empowerment to help themselves, rather than dependency) or be squandered through burgeoning malfeasance, and failure to safeguard the interests of the wider public (including businesses)?

The Dutch Disease (or resource curse) can severely undermine a country’s prospects if not taken seriously, particularly enriching a small elite at the expense of the majority.

PNG is preparing some of the right policies to address this, but these need to be applied properly and governance issues need to be taken much more seriously than now.

The countries which have benefited from their natural resource extraction have been those which have given transparency, accountability and good governance as their priority up front.

Those that haven’t have been basket cases or at least seen extraordinary poverty alongside gross wealth as in the case of some of the oil wealthy nations where popular uprisings are now occurring.

But note, the very poor tend not to rise up, as they have more immediate issues of survival to address!

“poverty and a lack of access to markets and essential services deprives people of opportunities and life” – photo by PWM; 2003

This post first appeared as a comment on Keith Jackson’s PNG Attitude blog in response to an ongoing debate between readers in their attempt to understand the issue of poverty and being poor in PNG in comparison to similar trends in African states. You can read up more on the main article that stirred up as much interests here.

Paul Barker is the Director of the Institute of National Affairs in PNG





Port Moresby wired for change

28 03 2011

This has to be one of the most interesting observations about today’s Port Moresby and where it is headed. The hustle and bustle of this city is never lost on the reader as Rowan Callick paints in detail the current socioeconomic trend in light of the economic boom powered by the extractive resource industry.

Although set against a political backdrop that is enmeshed in corruption, Callick focuses the spotlight more on the champions who are standing up for the people.

Without further ado, read on…

Port Moresby wired for change

By Rowan Callick, March 26, 2011, The Australian

PAPUA New Guinea’s founding father and Prime Minister Michael Somare, aged 75 next month, was found guilty last Monday of 13 charges of misconduct and on Thursday was suspended from office for 14 days.

Until recently, this would have caused a sensation that would have virtually stopped the nation.

That it hasn’t demonstrates how rapidly PNG has changed. It is awash with cash, and corruption. It is wired everywhere, mobiles hanging off every ear, in a way unthinkable under the old government telecommunications corporation. And it is heading to overtake Australia’s population this century.

The leadership tribunal, chaired by Australian judge Roger Gyles, found Somare guilty of filing incomplete or late returns on his assets and business dealings to the Ombudsman Commission annually as required.

It is Somare’s skills as a leader and a player for 42 years in the PNG political game, which is at once ornate and brutal, that have held together his ruling coalition for almost 10 years.

But this long-anticipated court case has become more a coda to the passing of the old independence era than a decisive central movement of a fresh symphony.

For regardless of Somare’s personal fate, PNG is on the cusp of an extraordinary economic, social and political transition, one the country has not seen since gaining independence from Australia in 1975.

Where this change will take it remains utterly uncertain. But that it is undergoing a convulsion is clear.

A new generation is on the move, born since independence and unburdened by sentiment towards the past.

The election due mid next year, for which the manoeuvring is well under way, will indicate who is likely to win or lose from this transition. Usually, more than half the MPs lose their seats, and this time Somare has said he may decide to stand down at last, clearing the way for generational change.

Within 30 years, PNG’s population may start to overtake that of Australia as it stands today. Its capital Port Moresby is already approaching one million and appears set to be bigger than Brisbane before long.

Its economy is likely to grow faster than China’s this year, more than 8 per cent. Almost every leading resource company in the world is scrabbling over prospects there. Rio Tinto is back after the Bougainville civil war. BHP Billiton is back after the debacle of its withdrawal from Ok Tedi. The first liquefied natural gas project, costing $16.5 billion, is just beginning four frenetic years of construction in the Southern Highlands and along a pipeline route down to the liquefaction plant in Port Moresby. Massive mines are being developed elsewhere.

Port Moresby’s burgeoning backstreet lodges are bursting with landowners from gas fields and mine sites desperately seeking their fortunes from government and corporations, from anyone who may be persuaded to compensate them amply for their lost lands.

And life is being transformed especially rapidly by the wild rush into the mobile phone era.

Irish-based company Digicel, which specialises in telecommunications for developing countries, has launched a remarkably cheap service and backed it up by building towers all over PNG, giving its signals a nationwide reach despite its mountainous interior and myriad islands.

Streetside betel nut sellers and people offering single cigarettes for 25c now also sell SIM cards.

In bustling Tabari Place in Boroko in the capital, traders have set up booths where they sell mobiles and all the associated paraphernalia, the deals usually being conducted entirely in Tok Pisin, while in the background young preachers try to attract the attention of the milling crowds.

Downtown outside the US embassy, where security guards hold dogs on leashes and parking is restricted to diplomatic staff, people wander the pavements selling China-pirated DVDs of American movies for $4 a time, as well as memory cards and flash drives.

Papua New Guineans are able to contact relatives back in their villages by phone for the first time. The arrival of 3G has enabled people to go online throughout the country, accelerating the attractions of Facebook, which has already attracted 35,000 users.

Groups of young social and environmental activists — such as Act Now, Patriots, and The Voice, are building their numbers rapidly via such new technology, and also propelled by a growing rejection of the old politics of PNG: the parliamentary numbers game and the domination of money politics.

A “consultancy” firm run by one lobbyist from Enga province in the Highlands, the populous, high-energy but sometimes unruly region that is coming to dominate much of the country’s business and politics, is named, with breathtaking frankness, Money Talks Ltd.

A massive hoarding at the start of the road to the parliament carries the unadorned biblical text of Proverbs 29:2: “When the righteous are in authority the people rejoice. But when the wicked rule, the people suffer.”

Chronox Manek is among those sufferers. By rapid evasive action with his car, he only narrowly escaped an assassination attempt 15 months ago by gunmen outside his home but still requires treatment for his left arm where one of the bullets hit home.

He is the Chief Ombudsman, whose most contentious role is to police the leadership code that is the prime tool for combating corruption in PNG.

The foyer to the Ombudsman Commission’s office displays posters with cartoons. One shows a sleek politician urging a group of peers: “All those in favour of the construction of this hotel, say aye.” A thought bubble is emerging from his head at the same time: “On my block of land!”

Another has an Asian figure saying to an official: “I know you can’t accept a bribe. It’s illegal. But this is just a loan. Pay me back whenever you can.”

The stakes have never been higher in PNG, and thus the institutions established at independence by Australia have never been under such siege, especially the legal system.

Manek, who for many years was the top public prosecutor and has been the leading public defender, and has a master’s in law from the University of Melbourne, only pursues a limited number of targets at a time.

It is thus all the more extraordinary that the police have failed to make any charges over this assassination attempt on one of the country’s top constitutional office holders.

Manek tells Inquirer: “I’m left without information about what’s going on” over the case. “But it’s happened, and I’m moving on.”

He believes corruption began its insidious undermining of the country’s governance in the early 1980s, when PNG opened up to the logging industry.

“Our world was no longer an Australian-focused one but a much bigger world”, in this case, that of Asian timber corporations.

Manek’s favourite motto is “no sweat, no get”.

He believes that has been undermined by a growing culture of taking short cuts to getting rich. And he is keen to educate the public that it is its right to insist that governments deliver citizens the services they are paying for.

“I want to educate the leadership that the public is right,” Manek says.

Another figure who is urging on this shift to a new form of leadership in PNG is Powes Parkop, a young former journalist and human rights lawyer who is the Governor of Port Moresby.

He has gained a reputation for cleaning up the city and beautifying it, for new fountains, for Christmas lights, for his organising of family events in the evenings to “reclaim the night” from the rascal gangs,, with some positive indications: young hoodlums being chased away from evening big-screen relaying of rugby league games.

“We need to change the political culture and quickly,” Parkop says. “It has gone bad in PNG and we must alter that so that many other changes can happen, too. Too many people have effectively been disenfranchised, socially and economically.

“People have migrated here to Moresby looking for the land of milk and honey, and have found instead a place that is not so rosy.”

Sam Basil is another new-generation MP, a young businessman from Bulolo in Morobe province, scene of an early gold rush 80 years ago and where top global mining houses are building or planning to build world-sized mines.

Basil uses Facebook extensively in communicating his views, with his supporters and others.

He says he is concentrating much of his efforts on helping give the public accounts committee of the parliament the teeth it needs.

Paul Barker, executive director of the private-sector-funded Institute of National Affairs, says it’s crucial that the government ensures that benefits flow broadly from the new resource projects, especially from the ExxonMobil led gas deal.

“If the government doesn’t get its act together and leaders cream off the profits, then PNG will get only the downside, not the upside, from such projects,” he says. “As in the Arab world today, the people in their 30s are the talking generation. But the younger generation below them have no special respect for what’s happened before.”

Australia’s role as PNG enters this difficult transition remains substantially shaped by its aid program, which comprises about 14 per cent of the national budget. It is becoming more focused and more practical, advice giving way to implementation.

Last year AusAID built 400 classrooms, provided 500,000 textbooks and trained 9000 teachers. The aim is to raise this to 800,000 textbooks next year. They will be delivered via an international procurement agency, which is also being deployed for the health project that is following these education successes, aiming to distribute much-needed basic medicines to every aid post and clinic, however remote.

Alternative paths towards PNG’s development are reflected in the Port Moresby landscape.

Structures new at independence in 1975, such as the “pineapple building” where prime ministers once had their offices and the former main government building nearby, have been abandoned for sheer want of maintenance, today decaying skeletons.

Nearby, Malaysian logging giant Rimbunan Hijau — “forever green” — has built a massive mall, the Vision Centre. It is still largely untenanted but is likely to fill steadily, including with a new cinema complex that will be Port Moresby’s first since its old cinemas were shut as crime soared.

There is an intensity in the humid air, a gathering pace of change, as individuals and the nation as a whole dices for the prosperous future that has so far evaded them.

*spotter: Scott Waide
original article:
http://www.theaustralian.com.au/news/features/port-moresby-wired-for-change/story-e6frg6z6-1226027895290








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