Friday, March 20, 2009

Of doles and joblessness in Papua New Guinea



 ONCE AGAIN, Papua New Guinea is on the threshold of another massive bonanza from one of its natural resources – the rich liquefied natural gas (LNG) deposits which will go on commercial production very soon.

And because of this, a ranking government official was already savoring a scenario in which about three million of the country’s jobless out of the 6.2 million people would be living on the dole in the future, according to a news report yesterday.

However, in today’s edition of The National which reported the story, Minister for Petroleum and Energy William Duma said he has been misquoted by the reporter who was present, as he was speaking to his constituents in Mt Hagen in a dialect not familiar with many Papua New Guineans, including the reporter.

Anyway, anybody who had read yesterday’s report would easily deduce that Duma was anchoring his best hopes on the US$4 billion annual tax revenue that the PNG government would earn from the soon-to-start LNG project located just outside of Port Moresby.

Duma approved the US$7 billion LNG project last May so that the country would earn more revenue for the improvement of the country’s basic services like schools, roads, bridges, hospitals, health care clinics, police services and police housing – things most of the citizens have been deprived of since the country gained independence in September 1975.

The LNG deposit is said to be “the biggest natural gas find of the century anywhere in the Southern Hemisphere or the Asia-Pacific at least for the next 20 years”, according to InterOil Corp, which is sharing ownership with ExxonMobil (Esso Highlands) as operator, Nippon Oil, Santos, AGL and Mineral Resources Development Corp, a government entity.

“Our people should be on the dole,” advocated Duma, who is projecting that each of the jobless three million Papua New Guineans could receive from 100 kina (US$34.40) to K200 (US$68.80) every two weeks (fortnight) in the future, media reports quoted him as saying.

So it goes without saying that if three million people were paid K100 each a fortnight, the amount would be K300 million (K103.2 million) every two weeks or K7.8 billion (US$2.7 billion) a year. This year, the government budget amounted only to K9 billion (US$3 billion).

Obviously, it was the best news ever received by a huge crowd in Mt Hagen, the country’s third rural city where Duma presented his dole-out scenario. It could be assumed that most of those present were jobless and were just relying on their food gardens for daily survival.

The dictionary defines dole as an unemployment benefit paid to jobless citizens by rich and industrialized nations (like Australia) that enjoy stable economies.

Despite its massive natural resources – oil, copper, nickel, gold, timber, tuna, coffee and cocoa, among others – whose respective exploitation/commercial development is now delivering hefty revenues to the government coffers (except for the nickel project which is yet to start operation), PNG has remained on the list of United Nation Human Development Index (HDI) as one of the poorest in the world.

It has been projected that once in full operation, the LNG project could boost the government’s annual budget to K21 billion (US$7.22 billion) from the current year’s budget of only K9 billion; it could take care of a number of infrastructure development and livelihood-generating activities, especially for the rural people.

More than 85% of the citizens who are based in the rural areas live in hand-to-mouth existence as there is not much sustainable farm-based livelihood for most of them. Since most of them don’t have employable skills, they could not find employment in the growing number of industries and businesses particularly in Port Moresby, now a burgeoning city of close to half-million people. So far, there are only 300,000 to 500,000 Papua New Guineans who are gainfully employed.

Although PNG began enjoying economic boom seven years ago, the benefits are just reaching the grassroots in trickle, one reason the influx of rural people into the urban centers like Port Moresby has remained unabated.

Frustrated of being unable to land a sustainable job, a number of them have taken the path of lawlessness, thus giving the city government and the police hierarchy unwanted headaches and the usual day-to-day threats on the lives of city residents, both locals and expatriates.

The rural people could not understand why, despite government’s boasting of hefty annual revenues for its coffers courtesy of the country’s natural wealth and increased annual budget, the things that would give them economic independence – jobs -- have remained elusive.

One perception that continues to persist until now is that corruption is rife in high places of the government, the main culprit why a big portion of public funds for many rural developments could vanish in thin air even before they could reach the intended beneficiaries.

Which is why the country’s attorney-general and justice minister, Dr Allan Marat, has accused his colleagues in government of being “corrupt”.

To his great awe, he learned of how the culprits are siphoning off government funds intended for rural development, and he did not mince words when he told in this week’s session at Parliament how it was being done.

Dr Marat has alleged that some members of Parliament have been setting up companies that would become halfway homes for the huge funds allocated to them, as in pork barrel, to be used in funding rural projects that would help alleviate the lives of their constituents.

He declared: “You have to be serious about corruption in your districts, in your provinces; some of us leaders are guilty of corruption, and we have set up our own personal companies in our districts and provinces to eat up all the funds that are meant for development.”

“This is a clear example of what we leaders sitting here in this very parliament have been doing.”

While Duma is seeing a future where hundred thousands of Papua New Guineans are living off public money in the form of doles, courtesy of politicians who would be enacting a law to make this a reality, the expatriate community in Port Moresby is also entertaining another scenario:

Once the LNG project starts delivering the moolah in 2012, the time when it would begin commercial operation, expect the influx of more foreigners – individuals and multinational companies -- into the country to partake of the country’s windfall.

Many of them would come in illegally, using fake visas, or by overstaying their travel visa, or by crossing the border between Irian Jaya province in Indonesia and PNG.

There’s no doubt that the bubble of corruption would continue to swell because those with easy access to development funds, which could now triple in amount owing to the influx of more dollar revenue from LNG export, would likewise find new ways to skim the milk for their own cups.

And more and more Papua New Guineans – they include would-be-politicians and practicing politicians -- would do everything to become Members of Parliament, because once they get there, they are considered “made” – as long as they know what party to stick it out with. The right party could always lead them to the path of gold, as many MPs have discovered for themselves.

In some ways, the dole-out system may work as a palliative to relieve the day-to-day crunching economic burdens of most of the people, both in the rural areas and urban centers.

But this is also a sure way to encourage laziness and dependency among Papua New Guineans who, most of them if not all, have the penchant for the easy way out. It is a culture nurtured by the “wantok” system (“wantok” loosely means “one dialect”) in which the lone gainfully employed member of a family suffers the misfortune of feeding an entire, easy-going extended family.


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