Papua New Guinea: The Clock is Ticking

Papua New Guinea: The Clock is Ticking

The deep divide between the tiny elite minority in Papua New Guinea who enrich themselves at the expense of the vast majority of ordinary people will continue to grow with disastrous consequences unless the Australian government’s new Enhanced Cooperation Programme (ECP) is fully restored and Australian police return to Papua New Guinea. Only the most myopic observers fail to admit that crime and corruption are barriers to development.

But the Papua New Guinean government must meet the ECP halfway.

In a new paper to be released on Tuesday 31 May, Papua New Guinea’s Choice: A Tale of Two Nations, Helen Hughes and Susan Windybank argue that the Enhanced Cooperation Programme could serve as a catalyst for change, but only if it is accompanied by growth policies that tackle the economic stagnation that is both a cause and effect of the breakdown in law and order.

‘Growth will bring jobs and rising incomes so that raskols will have an alternative to crime, “ghosts” can be removed from the public service and corruption can be prosecuted in the courts.’

‘Improved security and reduced corruption are essential if growth is to be possible. But only the Papua New Guinean Parliament can make the choices for growth without which the attack on crime and corruption cannot succeed.’

Worldwide experience shows that declines in corruption, improved governance and effective democracy do not normally precede, but follow, growth. This has not only been the experience in East Asia, but also in other rapidly developing countries as disparate as Botswana and Chile.

‘Although the need to accelerate growth is recognised in Papua New Guinea, the key policy steps – land tenure reform, business regulation reform, industrial relations reform and the privatisation of key transport and public utilities – remain unpalatable to the deeply communitarian influenced Papua New Guinean commentariat.’

Worldwide experience also demonstrates that aid can only be effective in countries with strong pro-growth policies. AusAID should support Papua New Guinea in developing a sector-based, quantitative growth strategy that would identify the roadblocks to growth and the reforms necessary to overcome them.

‘Only if Papua New Guinea abandons the policies that have resulted in 30 years of population growth ahead of income growth can Australian aid be effective and will the lives of Papua New Guineans improve’.

Helen Hughes is a Senior Fellow at The Centre for Independent Studies and an Emeritus Professor of the Australian National University.

Susan Windybank is the Director of Foreign Policy Research at The Centre for Independent Studies.

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