Friday, June 29, 2012

Illicit trade into PNG begins at Batas Market


Batas Market, on the Indonesian side of the border with PNG at Wutung in West Sepik province, is where the multi-million kina trade of illicit goods into PNG begins.
Batas has, over the years, become a mecca for shoppers from all over PNG to buy cheap Indonesia food, clothing, electronic goods and other items, however, in recent times, it has become the hub for trade of illicit goods into PNG.
British American Tobacco, for one, estimates that PNG loses at least K7.2 million a year because of illicit tobacco products being smuggled in through the border post at Wutung.
Cheap Indonesia cigarettes and other goods on sale at Batas Market on the Indonesian side of the border last weekend.-Pictures by MALUM NALU

Millions more, however, is lost to PNG through smuggling in of other products from Indonesia, despite the Border Development Authority (BDA) being set up at a cost of K75 million in 2009 with the purpose of dealing with development and security issues in border provinces of PNG.
The concern is that smuggling is also indicative of a bigger, more aggressive cancer that eats away at government revenue and the local economy: transnational crime.
Transnational crime includes narcotics, arms smuggling, money laundering, human trafficking, counterfeit products and terrorism
The National visited Batas last weekend and saw pornography, sexual toys for both men and women, cigarettes, alcohol and various other items being sold at very cheap prices.
The multi-million kina illicit trade in PNG using smuggled items from Indonesia, particularly cigarettes, is flourishing during the elections with decreased Customs, police and military presence at Wutung Border Post.
The border post at Wutung
Lack of personnel at Wutung means that smugglers basically have free reign during the election period.
With PNG lacking maritime strength to patrol the sea border, there is no control of what comes in through this.
Customs were not checking in goods brought in from Batas Market on the Indonesian side of the border last weekend.
Last Sunday, The National witnessed the illicit trade at Vanimo Airport, where several carefully-packed cartons of Indonesian cigarettes consigned for Wewak and Mt Hagen were loaded on to an Air Niugini Q400 flight bound for Wewak, without as much as a question being asked as to their contents.
Cheap Indonesian cigarettes being sold at a roadside stall in Vanimo at the weekend. These cigarettes proliferate in Vanimo and are now being smuggled in large consignments into the Highlands.
A private intelligence source monitoring the illicit trade at the border, told The National in Vanimo that a highly-organised racket involving wealthy Highlands businessmen and local Wutung and West Sepik villagers existed.
A senior government officer told The National in Vanimo that the illicit trade was a serious threat to national security as guns, drugs and human trafficking could easily be carried out from Indonesia.
The intelligence source said the cigarettes were transported to Aitape near the border of East and West Sepik provinces, and then moved down to Wewak and then Madang for transport to the Highlands.
“It comes from the Batas Market, across the Wutung Border Post, and then comes out towards Vanimo,” he said.
“What the Highlands businessmen are doing is that they liaise with the local villagers and get them to carry Indonesian cigarettes across from Batas.
“They stockpile these cigarettes in the villages until they reach 20-30 cartons.
“These then come out from Wutung Village via boat or road to Aitape,  transported by road to Wewak, then loaded onto ships or dinghies for Madang or Bogia, where they are picked up and transported by road to Mt Hagen, Minj or Banz.
“The concern is that these Indonesia cigarettes are brought in without paying any excise duty to the government, which is missing out on millions.”
The senior government officer said this was a very serious threat to national security which must be addressed immediately.
“All stakeholders including Customs, police and PNG defence Force must work together,” he said.
“I do not know what the Border Development Authority is doing.
“There are no patrol boats manning the maritime border with Indonesia.
“Cutoms officers at the Wutung Border Post are under-resourced and this is a very big concern.
“Apart from cigarettes, anything can be brought into PNG like forearms, drugs, anything.
A Papua New Guinea customer (back to camera) checking out electronic goods at Batas Market.
“It’s a concern for the government and they have to address this at the national level.
“Smuggling is very big.”
A Customs insider told The National recently that  it was ironic that Customs collected K2.3 billion in 2011 fiscal year but the total recurrent allocations for 2012 was only K18 million which was a mere 0.008% of what the organisation collected.
“There are things happening at our borders every day,” the source said.
“The border control and enforcement agencies are under resourced in terms of manpower, logistical support and training.
“Further to that, border enforcement officers are not being properly looked after in terms of housing, good salary, etc.
“Government agencies have very low staff retention rates where well-trained and qualified persons leave and find pastures elsewhere for better working conditions.”
The source said acceptance of bribes by officers was brought by the increasing cost of living.
“An officer is likely to forgo over K20, 000 state revenue at any one instance by accepting less than K200 offer for approval and release of goods or people,” he said.
“The consequential risks attached with allowing such people or goods to enter the country are far more damaging for the people, the legitimate business community and the country in terms of security and revenue for the state.
“Responsible governments must increase funding towards staff welfare, salary/wages for staff and build the resource capabilities so that officers can perform their tasks with professionalism and due care.”

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