PNG in 2016: the year of finding solutions?

Madang, PNG (Flickr/Jonathan E Shaw)
Written by Bal Kama

Madang, PNG (Flickr/Jonathan E Shaw)Prime Minister Peter O’Neill reminded Papua New Guineans in his New Year’s address that PNG ‘is a place of great opportunity, that also carries with it great responsibility’. His optimism and patriotism were timely. Whether or not 2015 was the year of emergency I predicted at the start of last year, it was certainly a year of intense anxiety with a faltering economy, criminal court cases, Ombudsman Commission inquiries and an attempted vote of no confidence against the government. These issues, together with concerns about security and the El Niño drought, appeared to overshadow many of the achievements of 2015, including the estimated $600 million (K1.2 billion) Pacific Games and multiple loan-funded [paywalled] infrastructural developments. While the government deserves to be complimented for steering the country through 2015, numerous issues remain to be addressed.

Economy

The economy continues to be a worry for PNG. Despite reassurances from the government, projections from the International Monetary Fund (IMF) and some economists suggest severe revenue shortfalls and expending budget deficits in 2016 (see here and here). The Bank of PNG has recently weighed in on the issue, warning the government of further potential revenue shortfalls as the oil price continues to fall. A prolonged economic downturn will increase the already relatively high unemployment rate. Depreciation of the kina, which is needed to respond to falling commodity prices, will push up the price of many urban staples, and result in political and social pain.

Politics

The Opposition made an unsuccessful attempt for a vote of no-confidence against the government last year after the Supreme Court removed the restrictions imposed on the scheme as undemocratic. The Opposition is likely to make another attempt this year. While the Government appears to be stable with the support of a majority of MPs in Parliament, recent evidence of underlying political contentions suggests that any leadership challenge will not be taken lightly.

Legal

A major challenge for the courts in 2016 will be to deal effectively and swiftly with all the outstanding civil and criminal cases concerning political leaders that have congested the court system since at least 2012. Notable of these cases are those instigated by the anti-corruption Task Force Sweep (now disbanded), especially the allegations of fraud against the Prime Minister and senior ministers. Since the conviction of former Foreign Affairs Minister Paul Tiensten in 2014, and sentencing to nine years imprisonment, there has been growing scepticism about the delay within the justice system of cases of public importance. The Union Bank of Switzerland (UBS) loan case also remains to be finalised. The extraordinary courage and swiftness shown by the Vanuatu Supreme Court last year in imprisoning almost half of the government MPs for corruption-related charges should provide some inspiration for courts in the Pacific, including PNG.

Relations with Australia

Relations with Australia continue to be important and the benefits appears to be mutual. Among other things, PNG will receive an estimated $554.5 million (K1.2 billion) in ‘aid’ for the 2015/2016 periods, while the use of Manus Island as a detention centre has resulted in a remarkable decrease in boats carrying asylum seekers to Australia. However, the recent sacking of some Australian advisors attached to key government departments on allegations that they were ‘spying’ and were making the national employees ‘lazy’ suggests some underlying suspicions that may need to be addressed in the new year.

The issue of spying is highly sensitive. Some Pacific leaders have pleaded in the past for a mature and responsible response from Australia and New Zealand following Edward Snowden’s revelations that the two countries were spying in the Pacific. In a post last year on Devpolicy, I predicted that ‘these spy allegations have the potential to generate a new wave of suspicion and distrust that may haunt the region into the future.’ While some have contended that the recent sacking is not related to the issue of ‘spying’, it is clear that the PNG government is taking the suspicions seriously.

Another sticking point in bilateral relations will be the controversial Manus Island detention centre. Many have argued in the past that the arrangement has become a muffler for Australia’s voice in PNG. Australia is yet to return its employees alleged to have been involved in raping a Manus woman to face criminal charges in PNG, while recent allegations of robbery by an employee on Manus, and his swift extraction to Australia before formal charges were laid under PNG laws, raise further questions about Australia’s respect for the rule of law and the constitutionality of the detention centre arrangement.

These issues complicate what may otherwise be a promising year of bilateral relations on the back of a successful Paris Climate Change Conference and preparations for the 2018 APEC summit.

Other outstanding issues

Social media is fast becoming the single most powerful tool for advocating issues of public importance in PNG. Facebook groups such as PNG News have over one hundred thousand members. However, social media’s continuing impact may be hindered by the proposed Media Appeals Tribunal to be set up in 2016 to deal with those allegedly promoting ‘defamation and misinformation’. While the government has argued the merits of this proposal, it is widely feared that such actions will be undemocratic and discourage public scrutiny of political leaders.

Another issue that generate significant public discussion in late 2015 and will be of interest in 2016 is the SBS documentary that raised allegations of money laundering by an established law firm in Port Moresby. Both the Australian and PNG authorities, including the PNG Law Society, have indicated their interest in investigating the allegations. It is hoped that their findings will be made public in 2016, assuming that investigations are underway.

Security should be an important agenda item for the government, especially as it approaches the 2018 APEC Summit, which will be hosted in Port Moresby. Increasing disagreements between the police and the defence force, and instances of violence directed against the community, especially its vulnerable members, should be a priority concern.

Port Moresby Metropolitan Police Superintendent Ben Turi has declared [requires login] 2016 as ‘the year of bringing down criminals’. This is far more assuring than the outlook last year. But this crusade for justice is not without questions – who are the alleged ‘criminals’ and how do the police plan to bring them ‘down’?

Maybe 2016 will be the year many are hoping for: the year PNG finds solutions to many of its unresolved issues before the elections in 2017.

Bal Kama is a PhD Candidate at the College of Law at the Australian National University.

Bal Kama

Bal Kama began his PhD studies at the Australian National University College of Law in 2014. His dissertation seeks to examine the relationship between the judiciary and the parliament under the Papua New Guinea Constitution.

Bal was admitted as a solicitor in the Australian Capital Territory (ACT) after completing his Graduate Diploma in Legal Practice at the Sydney College of Law. Bal graduated from University of Canberra in 2012 with a Bachelor of Laws (Honours) and a Bachelor of Arts (International Relations and International Studies). He currently teaches at the ANU College of Law and the University of Canberra Faculty of Business, Government and Law.

Bal is also the Founder and Director of Kama Scholars Foundation (KSF), a community-based scholarship and mentoring program for village students and youths in the Highlands of Papua New Guinea. In 2016 he was named the Commonwealth Pacific Young Person of the Year.

9 Comments

  • Thank you Bal for the list.

    Another important concern that can be added to your analysis lists, PNG debt level over the last two years. Huge borrowing from external and domestic funders-estimated debts has gone up to over K25billion (over the limit of 35% allowed under the Fiscal Management & Responsibility Act) with some due for repayment which the government is unable to repay and has gone into co-financing to repay, further increasing the debts.

    Many of the economic decisions taken by the government in the last 2 years or so is outside the annual budget limit, therefore the true picture of the country cash flow is not declared, thus kept to few individuals who take a band aid approach by creating one problem to the next.

    Now PNG have a huge backlog of transactions for foreign exchange while BPNG running out of cash surplus, the recent borrowing of US$300m from IMF to fix the problem will not make much difference.

    Also the 2016 PNG budget of approximately K16 billion was handed down last November with a projected deficit of K2 billion (maybe to be financed through loans). However, with the current debts and cash flow situation, this projection will be beyond PNG capacity to finance its 2016 budget. No wonder, the reported cases of budget cuts made to PNG education and health services this year like the church health partnerships budget cut is a true reflection of this burden.

    The future looks frightening now for PNG.

  • Mr Kama, I totally agree that the government will want to go to the elections with minor problems on its shoulder, only time will tell.
    On a different note, it was interesting to sit in a tutorial you gave at upng (L19) on the concept of ‘separation of power’. As a political science graduate some years back at upng I was never given this insightful information.
    I am in first year law and I am eyeing constitutional law on ‘constituent power’ as the area of interest.

    • Werner,
      Good to hear that the tutorial at UPNG was of some insight. Some of the issues raised here goes to the heart of the doctrine of separation of powers in PNG.

  • A good analysis of where PNG stands. Issues affect our country were not addressed & solved while our government continue to plan for the future. I am afraid I may not see the change the government embark to bring this year 2016.

    • Thank you Levi. While parts of the article tries to be optimistic, early signs suggest the need for extreme caution on the part of the government in 2016. Will be an interesting year.

  • Bal excellent summary of what has happened previous years til last year. There are alot of outstanding issues that you’ve highlighted that need to be resolved.However, your summary has reflected that those issues are not solved properly. My fear is that there will be more coming this year though the Government may think the country may go smoothly. Thank you Bal for your highlighting. Great article to start the year.

  • Thanks for this Bal it is a great summary of what we can expect for PNG this year and has certainly helped me get some key issues clear in my mind. One small correction regarding the Vanuatu case you referred to. The number of MPs imprisonedin November was 14 (15 convicted) which constituted half of the government but not half of the parliament which numbers 52

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