Mineral wealth failed to better PNG standards

Source: The National, Thursday, March 14, 2013

By MALUM NALU

“SO rich and yet so poor” is a paradox that rings true for Papua New Guinea, as after years of extraction of our natural resources, our standard of living seems not to have taken a turn for the better, but for the worse.
 A case in point is Daru, the forgotten “capital” of Western, which has one of the lowest living standards in the world despite the billions of kina from the giant Ok Tedi mine.

Rundown post office and streets in Daru, Western province, despite the billions from Ok Tedi mine.-Nationalpics by MALUM NALU

Everywhere in the country, we see rundown roads, schools, and hospitals, among other facilities, which make us wonder where all the wealth from our resources has gone to.
It was because of this that the head of Extractive Industries Transparency Initiative (EITI) Secretariat, a global standard for improved transparency of government revenue from natural resources, yesterday met Prime Minister Peter O’Neill to discuss implementation of EITI in PNG.
Jonas Moberg, the head of EITI, also met representatives from the oil, gas, and mining industries, as well as local civil society organisations, which he said had expressed strong support for the EITI.
He told reporters at the US Embassy in Port Moresby yesterday, after meeting with O’Neill, that PNG was a resource-rich country with some of the region’s largest oil, gas and mining projects, and transparency about how much the government received from these resources was a one key step to ensure that all citizens of PNG benefited.

Moberg talking to reporters at the US Embassy in Port Moresby.

“The idea is very simple and that is to fight corruption, improve accountability, through transparency,” Moberg said.
“EITI is a standard implemented by countries, it’s implemented by 37 countries so far, and a number of other countries are preparing to do so, including the United States there’s a pilot in Australia, and obviously, there is a preparatory process by your government
“When the EITI is implemented, what essentially happens is that an independent report is done, bringing together what the companies pay in taxes, royalties, and fees, and what the government receives.
“So you get someone independent that has trust to go and ask all the companies, Ok Tedi, PNG LNG and so on, ‘how much have you paid in royalties and licence fees?’.
“And then you ask revenue commission, the IRC, and treasury, ‘how much have you received?’ and you compare to find out how much has gone missing.
“So the whole idea is you bring transparency in there.
“That makes it more difficult for money to go missing.”
Moberg said the EITI would be implemented by government, and supported by industry and non-government organisations, like Transparency International.
“It becomes very easy for transparency to become pointless,” he said.
“It has to be meaningful transparency, transparency that leads to improved accountability, that leads to trust being built with people.
“Therefore, there has to be a commission in every country, a multi-stakeholder group, so that government convenes an EITI PNG group, invites the companies, invites civil society, and says that, based on these global roles, we’re going to do it our way.
“And it is that group that needs to have the ownership of the EITI.
“There is an integral working group here so the process has started.”
Moberg said O’Neill had shown strong support for EITI at their meeting yesterday.
“His (O’Neill’s) commitment to this agenda could not have been stronger,” he said.
“We are very encouraged by what we see here.
“There is, of course, no doubt that your country has a long way to go in making sure that this sector brings benefits to the whole population.
“But the commitment that the prime minister has demonstrated now is quite impressive.
“I think that’s something very positive.
“It’s concerted action in the fight against corruption and to improve accountability.
“It’s these kinds of practical steps that the prime minister is so keen on, and we very much welcome.”