Tag: Politics

An Analysis of Papua New Guinea’s Political Condition and Trends Through to 2025

last updated: August 2017

Introduction

Papua New Guinea entered its 2017 National Election after a tumultuous period in the country’s politics and economy, and there remains much uncertainty about the election process, with significant implications for the country’s future. In the last ten years key political, bureaucratic, and regulatory institutions have struggled and in some cases, failed. These struggles have been more profound under the O’Neill government despite some tangible advances in the country’s ambitious Vision 2050 roadmap.

There is a widespread desire across the country for robust and independent institutions to ensure economic gains are transparently and sustainably managed. The ultimate question for many voters in the 2017 general elections was not who would form the next government, but who would be the most credible leader. With elections now over, and the O’Neill government returning for a second term, what does Papua New Guinea expect of the new government and those in power?

This analysis attempts to address how key trends in PNG’s politics will impact upon both the bureaucracy and regulatory environment. It will identify some of the key actors and how they are likely to change. It will discuss current political trends, their impact on the regulatory and legislative environments and how likely they are to continue in the future. Finally, it assesses the prospects of continuing dysfunction in PNG politics, the further marginalisation and deterioration of the bureaucracy, and how this destructive course might be avoided.

Who Are The Key Actors In Politics And The Bureaucracy, And How Is This Likely To Change In The Future?

Peter O’neill

Prime Minister Peter O’Neill has been the most dominant political player in PNG politics this decade. The dramatic events of the 2011 constitutional crisis resulted in the unexpected elevation of O’Neill into power. He quickly became revered among his peers as an experienced combatant of the country’s hostile politics.

O’Neill maintained strong populist support in the early years of his government by promising free health and education programs and infrastructure development, backed by a strong anti-corruption focus in the form of the Investigative Task Force Sweep. However, his prolonged resistance against his arrest warrant for official corruption has contributed to the deterioration of regulatory and enforcement institutions as well as reducing confidence in his political longevity.

With mounting allegations against him, O’Neill influenced key political allies and swayed the appointment of key bureaucrats whose loyalty helped consolidate his grip on power.

O’Neill’s influential political allies include William Duma, Dr Fabian Pok, Peter Ipatas, James Marape and Mao Zeming. Playing into existing regionalist sentiment within PNG politics, O’Neill maintains a firm inner circle of Highlands MPs and ensures that controversies involving them are subdued. Other key players in O’Neill’s ascension include former Prime Minister Pais Wingti, Speaker of Parliament Theo Zurenouc, Don Polye, Patrick Pruaitch and Ben Micah. Polye, Pruaitch and Micah were key allies in the early period of O’Neill’s government and were rewarded with senior ministerial portfolios until their falling-out with O’Neill led them to the Opposition. Don Polye and Ben Micah lost their seats in the 2017 election.

O’Neill’s political party, the People’s National Congress (PNC), also suffered losses of influential political figures such as the former Deputy Prime Minister Leo Dion, Mao Zeming and Theo Zurenouc. The latter two were critical, as in the past they leveraged support for O’Neill from MPs in the mainland coastal region (Momase).

Unlike his previous government, O’Neill initially faced an uphill battle against a resurgent Opposition group with 46 MPs. However, some members in the Opposition have defected to join O’Neill since his election as the country’s Prime Minister in August 2017. With the looming vote of no-confidence in the next 15 months, O’Neill will do whatever he can to retain support.

Charles Abel

The appointment of Charles Abel as Deputy Prime Minister is an attempt to retain support from the coastal MPs as well as redirect attention from O’Neill to a competent partner. In the last government, O’Neill played a prominent role while the Deputy Prime Minister was almost non-existent on the national scene. However, that is likely to change.

Abel has already been proactive in engaging with national issues and will be using his experience in trade and commerce to try and restore investor confidence. While Abel reports to O’Neill, he should be able to influence the Cabinet unlike his predecessor Leo Dion. Being relatively young and from the coastal region, Abel may also challenge and foster consensus among his peers and outspoken MPs in the likes of Gary Juffa, Allan Bird and Bryan Kramer in the Opposition, reducing the attention on O’Neill while presenting a credible image of O’Neill’s government.

Other Influential Members Of Government

Peter O’Neill has appointed a Cabinet of 33 members, the largest in Papua New Guinea’s history. Key Ministers within his Cabinet include James Marape, a loyal lieutenant who retains his finance portfolio; William Duma, a controversial figure who brought with him critical numbers to the government; Justin Tkatchenko, who holds the portfolio of Lands & Physical Planning; and Puka Temu, a leader of the ‘Papuan Bloc’ who holds the health portfolio. Other key members of government include Sir Julius Chan, a former Prime Minister and Governor of New Ireland province who crucially sided with PNC soon after the election. Job Pomat was also appointed speaker of Parliament, a position which brings with it significant influence. Pais Wingti and Peter Ipatas join Sir Julius Chan as senior politicians providing clam and stability among O’Neill’s alliances.

Sam Basil

Basil’s leadership in the Opposition and strong voice on important national issues has initially gained the respect of both sides of parliament. He led the resurgence in one of the oldest parties in Papua New Guinea, Pangu Pati, with the highest number of MPs in The Alliance, and hoped to be nominated as Prime Minister by the opposing coalition camp in the event of a change in government.

However, the elevation of Patrick Pruaitch as the Opposition Leader unsettled his ambition leading to his defection to join O’Neill in the government. Since a key campaign platform for Pangu Pati during the 2017 national election was to remove O’Neill, Basil’s defection together with 14 other Pangu Pati MPs, appeared to discredit Pangu Pati’s image among loyal supporters.

But Basil’s move may also be strategic to support any move within the government to unseat O’Neill. A common reason provided by all who have defected, including Basil, is the challenge in accessing the electoral development funds as an Opposition MP. While that continues to be an issue, Basil’s standing and the timing of his move is disappointing for the resurgent Opposition.

Sir Mekere Morauta

The return of Sir Mekere Morauta from retirement to national politics presents a significant threat to O’Neill’s continued dominance. Morauta’s intellectual leadership and statesmanship inspires unity among the parties opposed to O’Neill. Morauta and fellow Independent MPs have recently joined the Pangu Pati, allowing Pangu the highest number of MPs in the Opposition before the defection of its members to the government. The official position of Pangu Pati is unclear as its members in both the government and the Opposition claim to represent the party. Morauta inadvertently assumes leadership of the Opposition faction of the party.

Morauta leads a ‘redeeming plan’ that starts with the replacement of O’Neill. However, his long vendetta against O’Neill over the PNG Sustainable Development Programme (PNGSDP) funds, which O’Neill has sought to control by removing Morauta as Chairman, may invite closer scrutiny of Morauta’s past controversies.

Patrick Pruaitch

Patrick Pruaitch is the party leader of the National Alliance (NA), the second most well-established political party to Peter O’Neill’s PNC party and the current Opposition Leader. Founded by Sir Michael Somare, the NA-led government stayed in power for two terms prior to O’Neill’s takeover in August 2011. NA is well financed, with close links to foreign logging companies. However, partners in the Opposition doubt NA as trustworthy due to alleged mismanagement of the country during their term in government. It is one of the likely reasons for Sam Basil’s defection to join the O’Neill government after Pruaitch was elevated as the leader of the Opposition. It appears the appointment was more out of convenience to keep the NA Members in the Opposition.

While NA has publicly stated its opposition to O’Neill during their fallout in February 2017, key elements within the coalition continue to question Pruaitch’s leadership. Pruaitch was part of the infamous ‘kitchen cabinet’, alleged to be responsible for the country’s mismanagement during Somare’s reign. He was also Treasurer in the final years of O’Neill’s first term, when the economy was considerably mismanaged. Newly elected and well respected MPs Allan Bird and Walter Schnaubelt promise to instil some credibility in the NA party but this will not be immediate.

Other Influential Members Of The Opposition

Kerenga Kua is outspoken on complex legal issues associated with governance in PNG’s highly litigious environment. As one of the country’s most senior lawyers, Kua commands the respect of both parliament and the general public. A change in government would see him reignite anti-corruption efforts and ensure the completion of investigations against O’Neill. Kua’s ascension will likely see a restoration of confidence in the legal system.

Gary Juffa commands strong populist support and addresses issues such as unscrupulous foreign businesses, illegal immigrants and the West Papuan conflict with patriotic overtones that sometimes may appear contentious.

As a former army captain revered for his role in ousting the Sandline mercenaries, Belden Namah may come across as undiplomatic at times, but many regard his straight-shooting approach as necessary to ensuring accountability in a highly predatory political environment.

Another player, Bryan Kramer, is PNG’s most influential blogger with a significant social media presence due to his anti-corruption campaigns. Elected for Madang Open, Kramer is likely to be a leading voice for reform while engaging directly with the public on the inner workings of parliament and the government systems.

Formation Of Coalition Government

The existence of multiple political parties has meant that O’Neill had to form a coalition government, as has been the case for all governments since independence. There are at least three key drivers that influence MPs in the formation of government, in order of importance:

  • Which ‘camp’ has the numbers to form the new government?
  • What can I gain from joining a ‘camp’?
  • Is the proposed Prime Minister a credible person?

By this hierarchy, the credibility of Peter O’Neill as a Prime Minister is the least consideration for MPs despite outstanding serious criminal investigations against him. For some MPs, it is assumed that leadership will change during the term of the parliament through a vote of no confidence or other permissible means. The primary concern for MPs is to be in government rather than in the Opposition. Joining the Opposition means a loss of privileges, including the potential for ministerial portfolios, as well as difficulties in accessing the electoral development funds (District Service Improvement Program and Provincial Service Improvement Program).

The process of choosing the Prime Minister continues to be undermined not only by accusations of manipulation and inducements but increasingly it tends to be about what the MPs gets in return for their support, not the people of Papua New Guinea. With a high level of fluidity in MPs’ movements, this trend only adds to the anxiety that in PNG politics, ‘there are no permanent enemies or friends, only permanent interests’.

Key Actors In Bureaucracy And Regulatory Institutions

Some key players within the bureaucracy and state institutions have been able to exert power and have direct impact on political outcomes and the regulatory and legislative environment.

Issac Lupari

The Chief Secretary to the Government, Isaac Lupari, oversees the entire public service machinery and is one of O’Neill’s most trusted allies. He is an important asset for the government, with extensive experience and networks within the echelons of PNG bureaucracy.

However, Lupari’s position is untenable. He was implicated in the Finance Inquiry, which uncovered a multimillion fraud syndicate involving very senior public servants, MPs and private companies associated with the Department of Finance. The Commission recommended Lupari for criminal charges but none have yet been laid.

Using his insights into the public service machinery, Lupari influences O’Neill and his Cabinet in the appointment of departmental heads. Lupari continues as Chief Secretary under the O’Neil government although a potential change in government may affect the pending criminal investigations against him.

Other Important Actors

Other key actors directly contributing to or affecting the regulatory and legislative environment include:

  • Police Commissioner Gari Baki
  • Judges and Lawyers
  • Defence Force Commander Brigadier-General Gilbert Toropo
  • Ombudsman Commissioners
  • Public Prosecutors
  • The Secretaries of Finance, Treasury and Planning
  • Provincial and District Administrators

The following analysis identifies these actors, considers their impact on institutions and the resulting trends. In the last ten years it appears that having influence within the security forces is imperative to the continuation of political power. Further, having access to funds through the finance, treasury and planning departments, and local government administrators assist in the misuse of public funds. The conduct of the Ombudsman Commission, the Public Prosecutor and those within the judicial system appears to be relatively robust, but assisting them in addressing their many challenges will enable them to operate more effectively in a politically volatile and highly litigious environment.

How Are These Actors Likely To Shape The Legislative And Regulatory Environment?

The key legislative and regulatory agencies in Papua New Guinea include the parliament, the police, the Ombudsman Commission, the courts, and departmental agencies such as the Financial Intelligence Unit (FIU) within the Department of Finance. Political actors have been able to influence these agencies with a common purpose of limiting their impact on political and personal agendas. There are weaknesses in each of these institutions, which need to be addressed in order to bolster the integrity of PNG’s legislative and regulatory framework.

Weak Parliament

The Papua New Guinea parliament was envisaged to play a ‘central role’ in shaping the country’s democracy both through its law-making function and as the leading forum for debate on national issues. Papua New Guinea’s parliament has been complimented for its stability in recent years, but this has come at the cost of robust debate.

The parliament has been riven with controversy since the 1980s when the vote of no confidence scheme was first activated, leading to significant parliamentary instability. Successive governments have used their numerical strength to thwart the legislative process as well as suppress fair debates and parliamentary proceedings in order to, not only remain in power, but also maximise predatory political interests knowing they might not retain their seat in the next election.

As parliamentary stability has resumed, the PNG Supreme Court has observed over the years a growing trend to “bulldoze legislation through because there [has been] an absence of Opposition or their voices not entered in Parliament”, cautioning that “Parliament … should never be a ‘rubber stamp’ for the executive, and that any legislative programme of the executive should be subjected to the closest scrutiny”. Similar assertions were made of O’Neill’s government when overturning the changes made to the Constitution in the Manus Island detention centre case.

The Compromised Role Of The Speaker

The Speaker of Parliament has been a prime cause for weakening the parliament. Because parliamentary proceedings are non-justiciable (meaning they cannot themselves be a cause for litigation), the Speaker is left unrestrained to engage in questionable practices. In the 2011 constitutional crisis, the Supreme Court found that “the Speaker [Jeffery Nape] contributed enormously to the crisis” by failing to remain “neutral and impartial”. The Court noted that “the actions of the Speaker appeared to have been motivated by power and political expediency” and were “harsh and oppressive”.

Backed by his contentious spiritual beliefs, the Speaker under the O’Neill government, (now ousted) Theo Zurenouc, is credited with restoring some credibility to the parliament, but his conduct has not escaped similar accusations of bias. This issue is most likely to continue in the new government with even Zurenouc admitting that it is a “dangerous trend [that] needs to be proactively addressed”.

Vote Of No Confidence Threatens Stability

Under the PNG Constitution, a government can be subject to a vote of no confidence after 18 months in power. The threat of a vote of no confidence often immobilises ‘normal executive and legislative functions’ leading to increased ‘corruption and patronage’ despite appearances of stability. Former Prime Minister Sir Julius Chan confessed that the vote of no confidence system means a prime minister “has to spend a quite disproportionate amount of his time and energy keeping individual politicians ‘happy’”. The Speaker can manipulate the proceedings in order to give unfair advantage to a party. While this system remains in place, incoming governments continue to face instability after the grace period.

Party Hopping

Papua New Guinea has never had a strong political party system, and with 45 political parties participating in the 2017 elections, this continues to be a challenge. Once in parliament, political parties exist “solely as parliamentary factions” without firm ideological premises and party discipline. It allows MPs to hop between parties — leading to tradition of instability and growing urgency to address it.

An attempt was made in 2010 under the Organic Law on the Integrity of Political Parties and Candidates (OLIPPAC) to control the movement of MPs but the Supreme Court declared it to be unconstitutional on the basis that the penalties prescribed under the law against MPs were harsh and oppressive of their freedom to make political decisions. As evidenced by the near doubling of O’Neill’s PNC party during its first term in government, this trend will likely continue. The Registry of Political Parties has prepared an amended version of the OLIPPAC but is yet to be passed by the parliament.

While the country remains vulnerable to ‘party-hopping’, some key indicators, however, suggest that this is likely to change over the next decade.

First, voters over the years have developed an increased awareness and sensitivity to political parties. In the 2012 elections, Somare’s NA party lost more than three-quarters of their seats as voters became distrustful of the party. In 2017, O’Neill’s PNC party faced similar challenges, losing almost half of its MPs while some of its serving MPs ran as Independent candidates or even refused to state on their campaign posters that they were endorsed by the PNC. In contrast, newly revived political parties, such as Pangu Pati, campaigned successfully on the platform of being the oldest and reliable political party without the backing of wealth or senior political figures.

Second, because voters are becoming more sensitive to political parties, they are quick to hold their MPs accountable for their choices in joining a political faction. This was evident in the 2017 election where many voters expressed their dissatisfaction over their MP’s decision to join O’Neill.

Third, political parties are becoming more established and well connected to businesses and government opportunities, which means there are incentives, both inside and outside of politics, for MPs to remain committed to a party.

Fourth, major political parties are becoming wealthier and have the ability to induce and retain their MPs, and to finance new candidates in increasingly expensive election campaigning.

Despite these trends there will still be a strong focus on election candidates to run as independents so that if they are to win they can ‘keep their options open’ and extract the greatest benefit from a political party. More than half of the candidates in the 2017 election ran as independents.

Using Electoral Funding To Control MPs’ Behaviour

A primary factor in PNG’s political stability in recent years is the government’s control and distribution of the electoral development funds under the District Service Improvement Program (DSIP) and Provincial Service Improvement Program (PSIP). The Vice Minister for Provincial and Local-level Government Affairs has made clear the reason why multiple attempts to change the prime minister have been unsuccessful:

“The reason is because DSIP is there that’s why we will be in the government and support the O’Neill-Dion government. It’s not about your number of qualifications you have to lead the government, so long as you have the money, you will master the numbers.”

The annual funding for districts (DSIP) is currently K10 million, with provinces receiving K5 million for each district within that province (PSIP). The funds are intended for service and infrastructure developments, but the implementation of these programs in many electorates is highly questionable. The legislation provides for the funds’ allocation, but the amounts, and their timing, is at the discretion of the executive government through its influence on the state’s finance department.

This discretion allows the executive to influence MPs’ behaviour. This trend is likely to continue but will vary according to the government in place. While the system may be unsound and undemocratic, the funds restrain the movement of MPs, thus minimising political instability.

Lack Of Political Will At The National Level

Due to strong localised pressure and expectations from tribal, district and provincial forces, a majority of the MPs are committed to representing these interests at the national level than investing in addressing national concerns. This leaves a vacuum for a handful of political elites to take advantage at the national level. As long as they can keep the locally focused MPs ‘happy’ with what they need for their electorates, then they can have them bandwagon on any policy decisions, legislations or reforms.

This behaviour is slowly changing as local expectations are increasingly connected to national issues and as people become more informed through platforms such as social media on the importance of their MPs addressing national issues. But until that is fully realised, local pressures will continue to affect an MP’s behaviour, which, at times, can be detrimental to the national interest.

Legal System

Papua New Guinea is one of the most litigious societies in the world. While the trend to suppress high-profile cases casts doubt over the efficacy of the legal system, courts continue to play a pivotal role against a powerful executive government. The Supreme Court has reinforced its unwavering intention that “abuse of power by the [Executive] NEC must not be tolerated by the Court”.

The PNG judiciary comprises the Village, District, National and Supreme courts, with the National and Supreme Courts forming an appellate structure with jurisdiction over serious cases including constitutional matters. The judiciary currently consists of 39 judges, including two on secondment from the Australian Federal Court, an increase from the initial 34 judges in the last ten years.

Chief Justice Sir Salamo Injia aims to have between 80 and 100 judges on the bench by 2020. This positive development would increase the number of resident judges in the country’s 21 provinces, as well as judges serving in the proposed Court of Appeal, a new court to sit between the National and the Supreme courts.

Parliament has yet to approve and legislate the proposal. The proposed Court of Appeal hopes to decrease congestion in the court system and increase judges’ specialisation, but “staffing such a structure with judges of suitable ability and experience would be difficult for Papua New Guinea alone at its present stage of development”. Some fear that an extra layer of the courts may increase unnecessary appeals, already rife in the current system, although this would not be insurmountable for a robust and independent judiciary.

The Court has taken an active approach against what it perceives as a ‘creeping tyranny’ in parliament, when it granted ‘standing’ to the Opposition Leader and senior public servants in 2014 to challenge constitutional amendments in Court. The Supreme Court allowed former Opposition Leader Belden Namah to prosecute the Manus Island detention centre case after he failed to defeat the constitutional amendment that sanctioned the Australia–PNG bilateral arrangement in parliament.64 Such is unheard of in comparable democracies but the Court has deemed it necessary against the fundamental inefficiencies of the Parliament. This precedent is likely to continue.

Howe

Why has a coherent party system failed to develop in PNG?

The question, why have parties not developed, implicitly assumes that political parties are an inherent part of a parliamentary system. Certainly, the process of majority decision-making encourages groups of like-minded members to come together to ensure the numbers necessary to push legislative agendas, and when there are significant lines of social cleavage — class, ideology, ethnicity, religion, region — and corresponding clearly differentiated collective group interests, these might form a natural basis for party organisation. This has been the history of political party development in most developed nations. But it does not describe politics in PNG.

First, as Hegarty has argued, PNG lacked the galvanising influence on politics of an independence struggle, through which parties have often been defined elsewhere, and, after the early differences between Pangu-NP and UP over the speed of transition to independence became irrelevant in 1975, party platforms, as we have seen, tended to converge. Class has not emerged as a major social cleavage in a country where about 85 per cent of the population is at least partly involved in subsistence agriculture and even the urban elite tend to retain their links with the village. Undoubtedly, there is a growing gap between rich and poor, but Western class models are largely irrelevant in explaining the dynamics of economic inequalities in PNG. Regionalism has had more impact on PNG politics, especially in relation to a continuing Papuan identity, but it has not provided a systematic basis for party organization. Indeed, to achieve office, all coalitions need to put together a group representative of all four regions, and this to some extent cuts across regionalism as a base for party organisation. In the absence of such social or geographic cleavages, collectivities have developed primarily from personal networks. Since politicians also compete for office, these personal networks are typically fragile, especially among aspiring leaders.

Secondly, and not unrelated, politics in PNG remain essentially parochial. While I have argued elsewhere that the view of electoral outcomes in PNG being determined by clan or ‘tribal’ loyalties is an oversimplification, electoral success nevertheless seems to be determined primarily by local factors: local reputation, local perceptions of a candidate’s ability to deliver goods and services to his or her electorate and the effectiveness of electoral campaigning. Successive studies of PNG national elections have provided little evidence of a party vote – even of a strong Pangu vote in Pangu’s stronghold of East Sepik — and only occasionally (as perhaps in the case of Sir Michael Somare, the country’s first Prime Minister) has a national reputation translated into local votes. Added to this, a high turnover of parliamentary members means that most MPs seek a quick return from their period in office, and this places a premium on being in government, preferably with a Cabinet portfolio. Indeed, MPs’ constituents generally expect their member to be in government, regardless of party attachment. After several Opposition MPs defected to governing coalition parties in 1990, they explained: ‘We are elected to Parliament to be in government.’

As a result, MPs are driven less by the desire to implement a particular policy agenda than by the desire to maximise the returns, for themselves and their constituents, from being in office. And as every government since 1972 has been a coalition and, until 2002, no government has survived a full parliamentary term, with MPs hopping from one party to another and parties shifting allegiance from one coalition to another, the potential for individual interest outweighing party loyalty is substantial. This has been reflected in the frequency of votes of no confidence. In such a volatile atmosphere, party loyalties are difficult to sustain. OLIPPC sought to address this problem by strengthening parties, but developments since December 2003 have so far suggested that MPs are not willing to accept the constraints of the OLIPPC and that the State is either incapable of enforcing the provisions of the organic law or unwilling to pursue them.

Related:

The OLIPPC, LPV and Parties since 2002

In the latter half of the 1990s, there was considerable dissatisfaction within PNG about the country’s lack of social and economic progress and growing problems of lawlessness and corruption, and growing criticism from outside. On becoming Prime Minister, Morauta vowed to address these issues and ‘to restore integrity to our great institutions of state’. A major plank in his government’s reform platform was an Organic Law on the Integrity of Political Parties and Candidates (OLIPPC). A secondary measure was an amendment to the Organic Law on National and Local-level Government Elections to change the electoral system from one of first-past-the-post voting to one of limited preferential voting.

In each national election in PNG since 1972, there has been a steady increase in the number of candidates contesting, notwithstanding an increase in the required fee for candidature in 1992, from K100 to K1,000 (then roughly equal to per capita GDP). While some of these candidates might have been put up to split the local vote of a rival candidate in another clan or another part of the electorate, with voter support being localised there are often several candidates with a good chance of winning if they can hold their support base together. There has also been a fairly steady increase in the proportion of candidates who have stood — at least overtly — as independents. These developments have had at least two adverse effects on elections: first, with the number required for victory sometimes relatively small in open electorates with many candidates, holding one’s bloc together is critical, and this has encouraged voting irregularities and violence in parts of the country, especially in the Highlands. In 2002, this caused the declaration of failed elections in six of the nine electorates in the Southern Highlands. Secondly, with many candidates competing, the percentage of the total vote that winning candidates have obtained has been, on average, steadily falling. Concerns about these issues lay behind the OLIPPC.

After widespread public consultation, organised through a Constitutional Development Commission, and parliamentary debate, the OLIPPC and associated constitutional amendments were passed in December 2000 and came into force in 2001, in time for the country’s sixth post-independence elections. In a foreword to an explanation of the proposed legislation by the CDC, Prime Minister Morauta described the initiative as ‘the most important Constitutional change this country has made since independence’. Its broad objectives were to strengthen the party system and help return stability and integrity to politics.

The OLIPPC contains four main provisions.

Party registration

Political parties must be registered with the Registrar of Political Parties, an office created under the OLIPPC and independent of the Electoral Commission. An unregistered party cannot nominate candidates for election. Parties must submit details of membership and a constitution, and provide financial returns on an annual basis. Membership is not to be confined to people from a particular province, region or group and the party must not encourage regionalism or secession. Party offices are to be ‘elected in a democratic manner’ (spelled out in the legislation). Party members must be paid-up, and a person cannot be a member of more than one party. Provision is made for cancellation of registration (inter alia, if a party fails to file financial returns for two consecutive years), for dissolution of a registered party (where a majority of party members or 75 per cent of party MPs agree), and for amalgamation of registered parties. In addition to the Registrar, the OLIPPC set up a Central Fund Board of Management (renamed Commission on the Integrity of Political Parties and Candidates), whose membership comprises the Registrar, the Electoral Commissioner, the Clerk of the National Parliament, the chair of the National Economic and Fiscal Commission, and church and women’s representatives. The board appoints the Registrar and is responsible for dealing with registration applications and management of the Central Fund. By August 2001, 43 parties had registered (though not all had supplied the necessary documentation).

Funding of parties and candidates

The OLIPPC established a Central Fund, from which parties receive public funding. The sources of income available to the Central Fund comprise an annual appropriation from the national budget and (unlimited) contributions from citizens, international organizations and non-citizens. The allocation to parties is on the basis of K10,000 for each elected MP. In 2003, the Central Fund Board of Management approved the distribution of K990,000 to 20 parties, at the same time complaining that ‘The government has miserably failed to adequately fund the Board and its Secretariate [sic]’.

In addition, registered parties and candidates can receive contributions from citizens and non-citizens of up to K500,000 in any financial year, in each case — a somewhat generous provision, especially considering that the Constitution in 1975 precluded non-citizen contributions, and the CDC initially recommended a limit of K100,000. The donor and the recipient are required to provide details of such contributions to the Registrar, though there have been complaints that the Registrar has not been fully informed. Successful candidates are also required to submit a detailed financial statement within three months of election.

Strengthening political parties in Parliament

Probably the most important provisions of the OLIPPC were those intended to prevent ‘party-hopping’. Under the organic law, a Member of Parliament who was elected as a party-endorsed candidate cannot withdraw or resign from that party during the life of the Parliament (unless he/she can establish that the party or an executive of the party has committed a serious breach of the party’s constitution or that the party has been adjudged insolvent) and cannot vote against a resolution of the party concerning a vote of no confidence, the election of a Prime Minister, approval of the national budget or a constitutional amendment (a member can, however, abstain from voting). Contravention of this provision is regarded as resignation from the party and sets in motion a series of procedures that can culminate in the member having to reimburse the party for all campaign and other expenses received from the party, exclusion from appointment as a minister or committee chair, or dismissal from Parliament. A member elected as an independent can join a party after the initial vote for prime minister, and then incurs the same obligations to the party as a partyendorsed candidate. A member elected as an independent who remains independent, but who supported a particular candidate in the vote for prime minister, must not vote against that candidate or his/her government in a subsequent vote of no confidence, nor against a budget brought down by that government, nor against a constitutional amendment proposed by that government.

These provisions were tested in December 2003, when the Somare Government, already facing threats of a vote of no confidence, sought to extend, from 18 months to 36, the grace period within which an incoming government was free from a vote of no confidence. The proposed constitutional amendment was defeated, but several parties split over the issue. Some members who voted against their party leader defended themselves by arguing that there had not been a formal party resolution on the issue. The issue has not to date been resolved.

The OLIPPC also provides that, after an election, the Head of State shall invite the party with the greatest number of endorsed candidates elected to form a government and to nominate a candidate for election by the Parliament as Prime Minister. This was intended to minimise the post-election lobbying that had produced the ‘lock-ups’ after earlier elections. In 2002, this probably gave an advantage to Somare, as leader of the NA, and Somare was duly elected Prime Minister, but it did not eliminate the post-election machinations and it did not necessarily ensure a victory for Somare.

Incentives for female candidates

In an effort to address the massive under-representation of women as electoral candidates and in the National Parliament, the OLIPPC provided that where a party-endorsed female candidate received at least 10 per cent of the votes cast in her electorate, the Central Fund would reimburse up to 75 per cent of the campaign expenses outlaid on her by the party. In 2002, the number of female candidates (mostly independents) rose from 45 to 74, but the number elected fell from two to one, and only received 10 per cent of the vote.

Before the 2002 national elections, 43 parties had registered with the Registrar for political parties, though many of these had very small membership and, on the eve of polling, a number had not provided the Registrar with the required list of candidates. In the event, with ‘failed elections’ declared in six seats in 2002, 24 parties were represented in the new Parliament: the NA with 19 members, PDM 13, PPP eight, Pangu six, PAP five, People’s Labour Party four, nine parties with two or three members and another nine with one member each. Seventeen candidates were elected as independents. By December 2003, the number of parties had been reduced, through amalgamations, to 18. As the leader of the party with the most winning candidates in 2002, Somare was invited to form a government, and he was subsequently elected Prime Minister by a vote of 89 to nil, with 14 members abstaining. The PDM, under Morauta, joined the small Opposition group, subsequently changing its name to the Papua New Guinea Party (PNGP). Wingti was re-elected in 2002, but he stood as an independent and did not seek to regain leadership of the party he had established.

The shift from first-past-the-post voting to limited preferential voting (LPV) was affected in the general belief that such a change would bring about greater cooperation between candidates, reducing the number of candidates and lessening the violence associated with recent elections — though the rationalization of this belief has never been made very clear. LPV came into effect after the supplementary elections in the Southern Highlands in 2003. By December 2004, there had been six by-elections held under LPV. All were fairly peaceful affairs, with fewer candidates than in the 2002 national elections, but since that is usual in by-elections it would be premature to take these outcomes as a validation of this particular piece of social engineering.

 

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National Parliament of Papua New Guinea

National Parliament of Papua New Guinea (PNG) is a single chamber legislature (law-making body) consisting of 89 Members elected from Open electorates and 22 Governors elected from Provincial electorates. The total 111 Members are directly voted into office by citizens over 18 years of age and represent Papua New Guinea provinces and districts.  After an election, the political party with the most seats is invited by the Governor General to form Government. Since Independence all Governments have been formed by a coalition of Parties because no Party has won enough Seats to form Government alone. The National Constitution gives the legislative (law-making) power of the people to Parliament. The PNG Constitution also declares that the maximum term of a Parliament is five years.

The National Parliament was first created in 1964 as the House of Assembly of Papua and New Guinea and became the National Parliament of Papua New Guinea in 1975 when Independence was granted. The House of Assembly building was located in downtown Port Moresby and had previously been used as a hospital. The new Parliament building was officially opened by His Royal Highness, Prince Charles, on 8th August 1984. The old House of Assembly building has been demolished and a Political History museum/library is being built as part of the redevelopment of the site.

Parliament House

Parliament House is an iconic building in Papua New Guinea and a building that PNGans can all be very proud of. It is open to the public on week days (except for public holidays) and Parliamentary staff are available to do guided tours for groups of visitors. If you live in Port Moresby or are a visitor to Port Moresby make sure that you visit our Parliament – it is certainly worth the effort.

National Parliament Official Website: www.parliament.gov.pg

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Political Background of PNG National Election

Early and Colonial History

Archaeological evidence of humans on the island of New Guinea has been dated to approximately 50,000 years ago. Spanish and Portuguese sailors sighted the land in the early 16th century. The Dutch claimed the western half of the island in 1828 as part of the Dutch East Indies. There was some limited foreign exploration of the eastern half of the island in the 19th century, and a few settlements made. In 1884, Germany annexed the northern parts and Britain proclaimed a protectorate over the southern parts, which were formally annexed by Britain in 1888 and became British New Guinea.

In 1906, Australia took over British New Guinea, renamed a year earlier as the Territory of Papua. The Australian army occupied German New Guinea during the First World War and in 1920 Australia received from the League of Nations a mandate for the government of New Guinea, as it was then called.

In 1942 the Japanese army occupied parts of New Guinea and Papua; the Australian military administered the rest. Papua New Guinea played a significant role in World War II history, as a frontline of allied defence against Japan’s push southward. Following the war, under the Papua and New Guinea Act of 1949, the two parts were united for administration as the Territory of Papua and New Guinea and put under United Nations International Trusteeship. The Act set up a legislative council, under an (Australian) Administrator, with a mix of elected and appointed members. Under the Papua and New Guinea Act of 1963, the council became a House of Assembly, with 64 members, ten of them nominated official members and 54 elected from throughout the Territory in 1964.

The House of Assembly established a Select Committee on Constitutional Development, and its recommendations were adopted in 1967. This resulted in the number of elected seats in the House being increased to 84 in elections in 1968. A new ministerial system was adopted and an Executive Council established. In 1971 a new Select Committee recommended that the Territory prepare for self-government. Elections were held in April 1972. The House then had 100 elected members, with an additional three appointed and four official members. Sir Michael Somare became Chief Minister of a coalition government. Self-government was granted at the end of 1973.

Post-Independence

Papua New Guinea achieved independence on 16 September 1975, becoming a sovereign constitutional monarchy with Queen Elizabeth II as Head of State, represented by a Papua New Guinean Governor-General, Sir John Guise. PNG adopted a five-year parliamentary term and Sir Michael Somare, the Prime Minister at independence and leader of the Papua New Guinea United Party (PANGU Pati), was returned to power at the 1977 election. A parliamentary defeat in 1980 led to his replacement as Prime Minister by Sir Julius Chan, leader of the People’s Progress Party (PPP). Chan served as Prime Minister until 1982 when, following a national election, the Parliament re-elected Somare (PANGU). In 1985, the Parliament again passed a vote of no confidence in Somare, and Paias Wingti, leader of the People’s Democratic Movement (PDM) was elected Prime Minister. Wingti (PDM) was re-elected Prime Minister following the 1987 national election, but was removed following a vote of no confidence in 1988. Sir Rabbie Namaliu, who had successfully challenged Somare for the leadership of PANGU, became Prime Minister. After the 1992 election, Wingti (PDM) won back the Prime Ministership.

At independence, PNG’s Constitution incorporated a six-month grace period after elections during which no-confidence motions were banned (s. 145(4)). The aim of the grace period was to allow government sufficient time to settle into office, develop and implement policies. Parliament amended this law in 1991 to extend the mandatory period between no-confidence motions to 18 months to increase political stability. In an attempt to extend his grace period by a second 18 months Wingti resigned in 1994 without notice and was almost immediately re-elected. PNG’s Supreme Court ruled the manoeuvre unconstitutional and Sir Julius Chan (PPP) successfully challenged Wingti for the Prime Ministership. Chan was forced to resign in March 1997 as a result of a political and military crisis arising from the Bougainville conflict. Cabinet appointed a caretaker government headed by the Minister for Mining and Petroleum, John Giheno (PPP).

At the election held in 1997, 16 ministers (including Chan) lost their seats and Sir William (Bill) Skate, leader of the People’s National Congress (PNC), was elected Prime Minister by Parliament after a month of negotiations as the head of a four-party coalition. Beset by corruption scandals and an acute financial crisis, by mid-1999 Skate lost the support of the majority in Parliament. He resigned as Prime Minister in July, shortly before Parliament started its new session, and Sir Mekere Morauta, then leader of PDM, was elected Prime Minister.

Under Sir Mekere Morauta’s leadership, Parliament passed the Organic Law on the Integrity of Political Parties and Candidates (OLIPPAC) in 2001 (amended in 2003), introducing legislative measures designed to address political instability. OLIPPAC instituted stringent party membership rules designed to make political parties stronger and governments more stable. Under OLIPPAC, members of Parliament (MP) were to be penalised if they switched parties, and had to vote in accordance with their party on matters relating to constitutional amendments, budget appropriations and motions of no confidence.

2002 National Election

The national election that took place in 2002 was chaotic and violent, and marked by widespread voting irregularities, inaccurate electoral rolls, voter manipulation and intimidation (including at times by electoral officials) hijacking of ballot boxes, and outbreaks of violence among rival candidates, their supporters and, in some instances, against polling officials, resulting in dozens of deaths. The Electoral Commissioner declared elections in six of the nine electorates in the Southern Highlands Province to have failed when officials were unable to retain control over the process. In Enga Province, ballot boxes held in a metal container outside a police station for safekeeping were bombed with drums of aviation fuel.

Following the election, Somare’s National Alliance Party (NA) won 19 of the declared seats. Somare once again became Prime Minister, heading a multiparty coalition. With the OLIPPAC in place, the 2002 Somare government became the first since independence to serve a full five-year term in office.

2007 National Election

The 2007 national election was the first held following the enactment of a series of electoral reforms, some of which had commenced under the Morauta Government in 2001 . Notably, these reforms included the replacement of the ‘first-past-the-post’ voting system with limited preferential voting (LPV). The decision to move to the LPV system was in response to calls for MPs to be elected with larger percentage of the vote and, in part, to reduce tensions associated with candidate movements during the campaign period.

Somare’s NA won 27 seats at the 2007 elections, and secured the agreement of a further 59 MPs to join his coalition. Somare was therefore duly re-elected as Prime Minister by Parliament.

In July 2010, PNG’s Supreme Court ruled that key elements of OLIPPAC were unconstitutional, including provisions that restricted MPs on votes relating to the election of (and vote of no confidence in) the Prime Minister, the budget, constitutional laws, and whether they wanted to remain within a political party or change allegiance.

2011-12 ‘Political Crisis’

In March 2011, Somare departed to Singapore for medical treatment, for what subsequently emerged as a serious health condition. His absence extended for several months. On 2 August 2011, amid increasing concerns that Somare would never be able to resume office, a parliamentary vote declared the office of prime minister to be vacant. Peter O’Neill, PNC party leader, was then elected Prime Minister.

Parliament’s actions were immediately challenged in the Supreme Court, spearheaded by the Somare-led NA. Upon his return from Singapore in September 2011, Somare joined this action. On 12 December 2011 the court ruled that the declared vacancy was unconstitutional, and therefore the subsequent election of Peter O’Neill as Prime Minister was invalid.

Parliament passed a law in response to the ruling to prevent a return by Somare as Prime Minister (notably by placing an age-limit on the eligibility requirements for the post). O’Neill remained in the position of Prime Minister, confirmed by a parliamentary vote, and continued to enjoy the support of the public service, police and other key agencies, although Somare attempted to appoint his own defence and police commanders.

On 26 January 2012, a small group of military officers briefly took up arms against O’Neill’s appointed Commander of the PNG Defence Force, claiming the authority of Somare as the lawful Prime Minister. The attempted mutiny was quickly and peacefully defused by police and military loyal to O’Neill.

Despite a period of political tumult, marked by proposed delays to the election and attempts to restrict the authority of the court, elections proceeded in accordance with PNG ‘s Constitution during June-July 2012.

2012 National Election

PNG’s 2012 national election took place between 23 June and 13 July 2012. Polling was marked with widespread delays, ranging from hours to several days in some locations, and the official date for polling to conclude, originally scheduled for 6 July, was extended by one week to enable teams to conclude polling. The writs, originally scheduled to be returned on 27 July, were returned on 2 August 2012.

In coastal areas, polling was peaceful and correct voting procedures were broadly followed, albeit with some variances. Polling was also largely peaceful in the Highlands, although there were some isolated instances of violence and security forces were deployed in large numbers, and serious irregularities were observed in the voting procedures. The accuracy of the electoral roll was a cause of concern to many voters, with reports that numerous voters were turned away in coastal and islands provinces. Voting proceeded in the Highlands, despite the abandonment of the electoral roll altogether in most parts.

O’Neill’s PNC party won 27 seats at the 2012 national election, and secured support from additional parties, including Somare’s NA, which had won 7 seats and independent MPs to form government. On 3 August 2012, Parliament elected O’Neill Prime Minister.

Related:

Mining Agreements in Papua New Guinea

In Papua New Guinea (PNG), a mining agreement is the social contract entered into when a tribal people grants permission for mining on its land. The three basic elements of an agreement are:

  • Free, prior and informed consent (FPIC)—the decision to allow mining and the negotiation of mining agreements are arrived at in a fair manner, following the principles of FPIC.
  • Stakeholder identification—customary owners and other stakeholder groups are properly identified and written into the various sections of an agreement with accuracy, clarity and safeguards to ensure that recognition shifts do not occur over time.
  • Agreement governance—processes are specified, and their costs underwritten, that ensure: benefits (royalties, compensation for loss, lease payments, employment, business spin-offs, improvements to local infrastructure, commitments to social programs) will be appropriate and divided fairly among stakeholder groups; beneficiaries receive what the agreement says without hidden transaction costs throughout the mine life; there are appropriate protections for vulnerable people; monitoring and evaluation is carried out to professional standards; and reviews are held following an agreed timetable and to the same standard as used in the original agreement-making process, or better.

A local innovation to try to achieve parts of the above is the ‘development forum’, first used in the negotiations for the Porgera gold mine in 1988–89. Today, the Mining Act 1992 lays out the specifications of a forum and sets out a list of parties the mining minister should consider inviting.

At Hidden Valley, a forum was launched on 4 August 2004. The provincial administrator, Manasupe Zurenuoc, praised the cultural appropriateness of the talks, saying that ‘in a country such as PNG the Melanesian approach was the secret to success’. However, the participants were not the six sets of communities, labelled Stakeholder Groups A–E, in the impact area that were identified in the company’s social impact assessment, the document that should have guided the minister. Only Group A—represented by the mine lease landowners’ Nakuwi Association—participated in them.

The process ceased to be referred to as a ‘forum’ after two weeks. Sporadic media reports referred to ‘talks’ until a year later, when the Hidden Valley memorandum of agreement (MOA) was signed. After the mine construction period, emergency negotiations had to be held with Group B, an omitted stakeholder group made up of the Watut River communities, when their land was impacted by the discharge of waste rock.

On these counts, the process cannot be described as a ‘forum’ or, for that matter, be said to reflect an inclusive, ‘Melanesian’ approach. What in fact happened was that decisions were made over the interests of the unrepresented stakeholder communities without their consent.

A surprising inclusion in the MOA was that the six local-level governments (LLGs) surrounding the mine in Bulolo District were allocated royalty shares amounting to 20 per cent of the total. But, here again, the body created to plan the expenditure of funds by LLGs under the Organic Law on Provincial Governments and Local-Level Governments, the Joint District Planning and Budget Priorities Committee (JDPBPC), was excluded from the agreement-making process.

In short, the MOA process was deficient: in respect of stakeholder identification because it did not properly represent the parties that should have been involved; in respect of FPIC because of the closed-door nature of the talks; and in respect of agreement governance because it handed money to government entities in a way that bypassed the coordinating body established to guide district development.

This was evident at the time, but it was not until 2015 that any agency reported on the effectiveness of the MOA. This was in the form of research privately commissioned from the PNG National Research Institute (NRI) by the Bulolo District JDPBPC. The NRI’s report authors concluded that, while the financial flows to MOA parties were largely as set out by the MOA, the systems in place for managing them were ineffective and their impacts on development were ‘minimal’. The Nakuwi Association, the ‘link between the mine and customary landowners’, was described as ‘defective’ and its business subsidiary had not submitted a tax return for ten years (ibid.: 48). This is not a surprise: the pathologies can be traced back to the 1980s, when a previous business subsidiary delivered little to its community owners.

These things flow on to agreement governance as a whole—the technical work of seeing that what agreements say is actually implemented. The former Department of Mining noted the ‘isolation of the development forum from the process of planning for sustainable development’ more than a decade ago, and we can widen this to say that the more the state leaves most of the work of agreement-making to local parties, the less likely it is that attention will be paid to agreement governance, frustrating the broader national and international objectives of poverty reduction.

Related:

Characteristics of Political Parties in PNG

It is impossible, within a short space, to detail the constant comings and goings of members, defecting from one party and joining another, sometimes only temporarily, and the constant wheeling and dealing among party leaders seeking to advance their party’s interests or their own ministerial aspirations through the formation of new coalitions or the preservation of existing ones. The brief history conveys something of the flavour of party politics in PNG and provides a broad context within which some of the particular characteristics of political parties and the ‘party system’ in PNG can be highlighted.

Party organisation

Typically, political party organisation in PNG has been weak. Although, on paper, some of the larger parties have had organisational structures based on party branches, most parties have been essentially parliamentary alliances and have been dominated by prominent parliamentary members (or, in a few cases — the PPP with Julius Chan and the PDM with Paias Wingti — by former MPs who hoped to be re-elected). In between elections, party organisations in the electorate, such as they exist, have tended to lie dormant. Even Pangu, which in the 1970s and 1980s probably came closest to maintaining an effective organisation — at least in its strongholds of East Sepik and Morobe Provinces — found it difficult to sustain popular support.

As a result, the textbook functions of a political party in formulating policy options, recruiting supporters and selecting candidates have seldom been fulfilled in PNG. Indeed, rather than having party branches that select candidates from among their numbers for the open and provincial electorates, in most parties it is the party leader who seeks out and recruits likely candidates for party endorsement, frequently from outside the party.

Lack of mass membership has also affected party finances. In the elections of 1968 to 1987, the larger parties were generally able to offer financial and logistical support during election campaigns — financing candidate deposits and the printing of posters, providing vehicles, boats or outboard motors for campaigning and sometimes providing T-shirts or cash. Indeed, in the 1970s, several major parties had established ‘business arms’ to generate campaign funds. In the 1990s, most business arms seem to have been depleted and party funding for endorsed candidates seems to have substantially dried up. When funds were forthcoming to support party candidates, party leaders seem to have been the predominant source, strengthening the personalistic tendency in party identity.

In Parliament, party discipline has generally been weak, the institution of party whips not having become well entrenched, and, from an early stage, ‘party-hopping’ or ‘yoyo politics’ has been fairly commonplace.

Associated with the fluidity of party attachment has been a rise in the number of candidates standing as independents. Often such ‘independents’ have known party leanings and might have accepted campaign support from parties that might have endorsed another candidate, but have left themselves relatively free so that, if elected, they can ‘sell’ their parliamentary support to the party that makes the best offer. This has given rise to a particularly Papua New Guinean practice: after the declaration of candidates after elections, two or three camps are set up, generally well away from Port Moresby (even as far as Australia), by powerbrokers for the major parties, and attempts are made to physically assemble winning coalitions of elected members. Substantial inducements might be offered to attract members to a coalition, and, on occasion, there have been complaints that members have been held at such camps against their will (hence the term sometimes used for such occasions — ‘lock-ups’).

Bases of party differentiation

The ease with which some MPs have changed party allegiance reflects partly a lack of clear ideological (or other) differences between parties. In the period before independence, Pangu, together perhaps with the NP, was differentiated from the other parties primarily by its critical attitude towards the Australian Administration and its demand for early independence. The UP preferred a longer transition to independence, reflecting the view of its predominantly Highlander membership that they needed more time to ‘catch up’ with the coastal people, who had had a longer period of contact with the Colonial Administration and enjoyed higher levels of education and public sector employment. With the achievement of independence in 1975, this ceased to be a point of differentiation. Otherwise, the UP and PPP were generally regarded as more ‘business’ oriented and more favourably disposed towards foreign participation in the economy than Pangu, whose associations included trade unionists. But in practice the differences were not substantial, as the record of the first coalition government (1972-77) demonstrated. Indeed, on the one occasion that substantial differences on important policy issues did arise — namely, during the constitutional debates of 1974–75, which gave rise to the NPG — alignments cut across party lines. The nature of the coalition that replaced Somare in 1980 suggested further that issues were secondary to strategies for achieving parliamentary office, a view reinforced by the 1978 split in the UP and demonstrated in political behaviour ever since.

Among later-established parties, the MA, under the leadership of former Catholic priest John Momis and Bernard Narokobi, has been seen as a relatively socially progressive party; there have been several ‘labour’ parties, the most recent, the Papua New Guinea Labour Party, linked to the Papua New Guinea Trade Union Congress; there was a short-lived Socialist Democrat Party, ‘The True People’s Party’, established by former student leader Gabriel Ramoi; a Christian Democratic Party was launched in 1995, ‘with the vision to provide Christian Leadership in all levels of government’; and a United Resources Party emerged during the 1997-2002 Parliament with a platform that emphasised equitable returns from resource development. But none of these has done much to further the cause of issue-based politics. In the 1980s, there were suggestions that emerging social class divisions might provide a basis for political party development, but subsequent developments have not provided the evidence for such a view.

In the absence of class or ideological cleavages, ethnic or regional divisions seemed to be a likely base for political aggregation. The visiting UN mission in 1971 expressed concern at the regionalist tendencies in political party development, and the next year a local scholar forecast that ‘it will not be ideology or class interests which separate the parties — if there are more than one … regional interests are the most likely source from which political parties will derive their mass base’.34 Commentaries on the 1977 election tended to support this judgment: Hegarty observed that in the pre-election period ‘considerable social differentiation had become apparent’, but went on to conclude, ‘The basic cleavages in PNG politics are not ideological or class based but regional’, and Premdas and Steeves ventured the opinion, ‘It would be difficult for anything but an ethnically-based party system to emerge.’ By the 1980s, the regional concentration of party support appeared to have been diluted somewhat, nevertheless, there was still evidence of a regional element in party support: Pangu had its strongest support from the East Sepik and Morobe Provinces (in the case of East Sepik, Pangu support merged with loyalty to the provincial member, Pangu leader and ‘father of the nation’, Michael Somare), though from 1982 it began gaining support in parts of the Highlands; PPP and MA were strongest in the New Guinea Islands region; and UP, NP, Country Party, and subsequently PDM were associated primarily with Highlands politicians. More specifically, a Morobe District People’s Association (MODIPE) had been established in 1973 with the objective of preventing people from outside Morobe Province becoming parliamentary members for Morobe electorates (at this time, the Pangu member for Lae was a Papuan), and, in 1987, this sentiment was revived by former Morobe Premier, Utula Samana, who launched a Morobe Independent Group (MIG) and led it successfully into the election that year. A more substantial regional influence has been that exercised by Papuans. This began with the election of Papua Besena leader, Josephine Abaijah, and the formation of the Papua Party; it continued with the formation of the NP-associated Papua Action Party and Diro’s Independent Group, and the subsequent emergence of a Papuan Bloc in Parliament; these in turn provided the base of the PAP (initially a Papuan-dominated party, though in recent years it has received substantial support from the Highlands); after being elected in 1992 as an NP candidate, Skate formed the PNGFP, a Papuan-based party, and, in 1997, as leader of the PNC — a party with six Papuan MPs — he became the country’s first Papuan Prime Minister.

Longevity of parties

Not surprisingly, in this context, the majority of parties that have emerged over the years has been short-lived. There has been a proliferation of parties at each election, but those that do not achieve electoral success mostly disappear soon after the election. Many of these are essentially one-person parties.

Of the parties currently represented in the National Parliament, Pangu has enjoyed a continuous history as a major player since 1967, though it has suffered two major breakaways and is currently (early 2005) split into two factions; PPP also has a continuous record as a major party, though it too, is currently divided between two factions: UP and NP have survived, but with periods of low activity and records of factionalism; the MA has been a small but significant actor since its formation in 1980; and the PDM, PAP and NA have now been around, if sometimes fractious, for several years. Beyond that, parties have tended to come and go quite rapidly, mostly just before and just after elections.

See also: Political Parties in Papua New Guinea

Related:

Bougainville-Papua New Guinea Relations

Bougainville’s population in 2016 is approximately 300,000 (less than 4 per cent of PNG’s total population). Its 9,438 square kilometres is roughly 2 per cent of PNG’s total land area. Pre-colonial Bougainvilleans were organised mainly around tiny stateless societies involving great diversity in language, culture, and identities. Despite major social and economic changes since colonial ‘rule’ began in the late nineteenth century, the most significant social groups today continue to be nuclear and extended families, the localised clan-based landowning lineages to which those families belong (typically containing 50–150 members), and flexible groupings of such lineages.

While under nominal German colonial control from 1884 to 1915, the first administrative centre was only established in 1905, and Australia took control from 1914 to 1975. Under colonialism, interactions with people from elsewhere in PNG contributed to a pan-Bougainvillean identity, with the dark skin colour of most Bougainvilleans as the primary marker. Identity politicisation occurred after World War II, when:

because of the natural affluence of their village life and the coverage of the [Bougainville] district by Christian missions (mainly Catholic and non-Australian), the administration neglected to play a conspicuous role in development almost until copper was discovered. Bougainville was known as the ‘Cinderella’ district not because it was poor but because it was ostensibly neglected (Griffin et al. 1979: 150).

Identity politicisation was intensified by resentment of colonial racism and by development of the mine, which was seen as something imposed to benefit the rest of PNG with little regard to detrimental impacts on Bougainville itself.

A major manifestation of change since 1905 has been the expanding range of groups or organisations to which Bougainvilleans belong or relate (churches, women’s groups, local governments, economic enterprises, political parties, etc.). Nevertheless, the autonomy long enjoyed by local lineages and other pre-colonial social groupings remains the default position for Bougainvillean understandings of how to relate to these new social phenomena. This expectation of autonomy helps to explain the extent to which the diverse groups involved in the origins of the conflict expected autonomy from one another, as do groups involved in contemporary debates on the future of mining.

For most rural Bougainvilleans, PNG remains remote. This was even more so in 1963, when PNG-wide politics first developed around the election of TPNG’s first representative legislature, which included just one Bougainvillean representative. Concerns about national representation of Bougainville probably had little effect on voters in the 1963 and 1968 elections. However, rapid changes associated with development of the mine led to much wider understanding of such matters in the 1972 elections, contributing to the election of a young Catholic priest from Buin, John Momis, a critic of the mine and the administration, who continues to be a key political figure in Bougainville.

Growing agitation for a special political and financial status saw an interim Bougainville Provincial Government established in 1974, and disputes over its mine revenue share precipitated Bougainville’s attempted secession from PNG on 1 September 1975, just before PNG’s Independence Day. The crisis was resolved in mid-1976, when the PNG Government agreed to constitutional provision for provincial government and guaranteed that the new North Solomons Provincial Government (NSPG) would receive all of the royalties from the mine aside from the 5 per cent already payable to some of the Panguna mine lease landowners. Many Bougainvilleans concluded that only intense confrontation with PNG brought results, and that the little understood process of secession and status of independence would remedy many problems.

Following the 1976 agreement to end attempted secession, Bougainvilleans had high expectations of the NSPG. In 1977, John Momis became the PNG minister responsible for the new provincial government system established under the agreement. Strong support for autonomy of the NSPG was now expected from the centre, and these expectations were reinforced by establishment of the Momis-led Melanesian Alliance (MA) party in 1980. The MA soon dominated both NSPG politics (especially from 1984) and Bougainville’s four seats in the PNG Parliament. But neither Momis nor his party had a significant impact on PNG policy towards Bougainville. By the mid-1980s, the NSPG’s lack of expected powers over areas of growing concern, such as mining, land and internal migration, was a source of widespread disappointment. For many, the failure to pursue secession appeared to have been a mistake.

Related:

Electoral Systems in Papua New Guinea

Papua New Guinea (PNG) used an optional preferential voting system in elections held in 1964, 1968 and 1972, but then switched to a first-past-the-post system in 1975. The number of candidates contesting elections subsequently increased at every election, reaching an average of 27 per constituency at the 2002 polls. Numbers of victors obtaining more than 50 per cent of the vote declined, with the majority of MPs being elected on the basis of less than 20 per cent of the vote in 1992, 1997 and 2002. National elections became vehicles for the articulation of clan rivalries, particularly in the Highlands. Parties proved, at most, loose associations, which politicians were readily willing to ditch in pursuit of ministerial portfolios. Customary ‘big men’ competed for wealth, influence and authority through electoral processes, driven by pecuniary rewards attached to state office-holding. Whether or not they joined nominal political parties, victors’ positions remained highly precarious. More than half of all MPs lost their seats at most elections after independence, with incumbent turnover reaching an all time high of 75 per cent at the 2002 polls.

Inside Parliament, politicians frequently steer clear of political parties, or form fleeting party attachments that play second fiddle to personal advancement. No single party has ever obtained an absolute majority in Parliament. PNG had 10 governments from 1975 to 2002, three of which were dislodged by votes of no confidence. Governments are frequently formed by backroom cabals (‘lock-ups’), which proceed to divide among themselves the spoils of office. MPs on the Opposition benches thus have every incentive to, and little institutional inhibition against, plot the next no confidence bid. Many prefer to sit on the ‘middle benches’, in a twilight position between government and opposition, hoping to secure ministerial portfolios at the next reshuffle. Instead of yielding the frequently anticipated advantage of strong and stable government (due to seat swings that enhance or magnify narrower vote swings), the first-past-the-post system provides the backdrop for a highly volatile parliamentary set-up, in which unscrupulous and opportunistic ‘rubber band’ or ‘yoyo’ politicians prove willing to repeatedly switch allegiances for personal or constituency gain.

As a result, Papua New Guinean reformists have taken steps to strengthen the party system. The OLIPPC was enacted in 2002 and was aimed at strengthening political parties via controls over funding and restrictions on party-hopping. Those who contest elections as members of parties receive state financial support. Independents do not. Once a vote has been held for a prime minister, MPs are obliged to follow the party line on budgetary and constitutional votes, and in votes of no confidence. Cases involving MPs who cross the floor or fail to follow the party whip on these issues are heard by an Ombudsman Commission and, if necessary, are referred to a Leadership Tribunal, with the ultimate sanction being the forfeit of seats. New rules are aimed at restricting post-election horse-trading, by giving the party with the largest number of seats the first opportunity to form a government. One consequence, witnessed at the 2002 polls, was a sizeable increase in the official number of political parties, which rose from 12 in 1997 to 43 in 2002, although many of these existed only on paper and failed to obtain a single MP. The rules have proved difficult to implement, and, as in India after the introduction of similar legislation in 1985, much party side-switching continues, either illegally or (where this is sanctioned collectively by a party) legally.

A limited preferential voting system (LPV) was also introduced in PNG, and came into effect in the wake of the 2002 general elections. It was aimed chiefly at avoiding the proliferation of MPs elected on the basis of less than 10 or 20 per cent of the vote. To cast a valid (or formal) ballot, citizens are required to list three candidates in order of preference (incomplete ballots with only one or two preferences marked are to be discarded as invalid or informal). If no candidate gets a majority of first-preference votes, the lowest-polling candidate is eliminated and his or her voters’ second-preference votes are redistributed among the remaining candidates. This process of elimination of candidates and redistribution of votes continues until one candidate obtains 50 per cent plus one of valid votes or until ballots are exhausted. PNG’s new electoral system is designed to encourage more moderate or conciliatory candidates, who reach out beyond their core bases of support in the hope of obtaining second- or third-preference votes from other communities. Both reforms, in different ways, anticipate and encourage a more issue and/or party-based political culture. Just as the candidate with the broader appeal is anticipated, after the introduction of the LPV, to pick up preference votes outside his or her community, so too the more broadly aligned party MP is to receive financial encouragement under the OLIPPC.

Implicit in the philosophy behind the introduction of the OLIPPC and the LPV was the view that Westminster-style political organisation and the first-past-the-post system were in fact responsible for vote-splintering among numerous candidates, high incumbent turnover and volatile allegiances inside Parliament. If these are shown to owe their origin to inappropriate electoral laws or the constitutional set-up, then institutional change would appear to be a viable method of broadening the basis of parliamentary representation and stabilising governments. If those features have other origins, the two reforms are likely to do more to change the form, rather than the substance, of PNG politics. Claims that electoral rules were responsible for PNG’s hyper-fractionalised party space sit oddly next to the Duvergerian association between plurality rules and a two-party system, suggesting that the ultimate origin of vote-splintering lies elsewhere. Variations in the financial incentive structure made little difference in the past. As Ron May points out, even a tenfold rise in the PNG nomination fee in 1991 did little to arrest candidate proliferation.

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Changing Geopolitical Dynamics For Papua New Guinea

last updated: August 2017

Introduction

The new O’Neill government faces a rapidly changing external environment as it struggles to manage a significant domestic economic downturn and unprecedented pressures on the national budget. Australia remains Papua New Guinea’s closest foreign partner; by far its largest bilateral aid partner, trading partner and foreign investor, but its influence is diminishing as that of other actors is growing. China is an increasingly important player — as a trade partner, investor in infrastructure and source of foreign loans, as well as in the small to medium business sector. Relations with other Asian nations are expanding. Large foreign companies are exerting more influence on government policy than most nation state development and trade partners of Papua New Guinea can hope to exercise. These relationships are likely to come into sharper focus over the next year, as the PNG government prepares to host APEC in 2018. It is not clear that the new PNG government has the capacity to pursue the national interest abroad while it is preoccupied with a complex set of challenges at home.

How Papua New Guinea Interacts With The World

The Pacific Islands region, once remote from the global centre of economic gravity, is now benefiting from its proximity to the centre of global growth that is China, East Asia, and India. The neglected and relatively poor Pacific Islands end of the Asia-Pacific region is increasingly attracting the attention of outside powers as its neighbourhood has grown wealthier. China’s profile in the Pacific Islands has grown enormously. China’s interests in Papua New Guinea have predominantly focused on trade and investment but in the last year Beijing has for the first time leveraged these interests to put public pressure on the PNG government and other governments in the region to support its actions in the South China Sea, signalling a shift in dynamics in its relations with the island states.

Papua New Guinea, the largest, most resource-rich and most populous state in the Pacific Islands region, has the potential to be the most influential player in the region. While it takes its responsibilities in the Pacific Islands region very seriously, Papua New Guinea has been more interested in recent years in improving relations with Asian countries, where there are more opportunities to expand trade and attract investment. A member of APEC as well as the Pacific Islands Forum, Papua New Guinea has longstanding trading relationships with key Asian economies China and Japan, and growing trade relations with other East Asian nations, including Indonesia with which it shares a land border. The shift of PNG’s connectedness into Asia and away from Australia is exhibited in Figure 1.

Figure 1: PNG’s rapidly changing trade portfolio

As PNG’s relations with Asian countries have been strengthening, it struggles to play a consistent leadership role within the Pacific Islands region. This is in part because Papua New Guinea lacks the financial capacity to support a more ambitious regional policy. The budget of the Department of Foreign Affairs and Trade has steadily declined since 2013 and there is no indication that more resources will be available to the Department in the near future. The Department’s actual expenditure totalled PGK 68 million in 2015, down from PGK 75 million in 2013, and the appropriation for the Department in 2016 was reduced to PGK 59.3 million and in 2017 to PGK 44 million.

Papua New Guinea’s 21 foreign missions appear to be struggling with reduced funding. The most obvious consequence of this was Papua New Guinea losing its right to vote at the United Nations in early 2017 after failing to pay its United Nations dues. Following media reporting of the issue, the PNG government eventually paid the outstanding sum of US$100 891 to regain its voting rights.

Papua New Guinea is also constrained by Fiji, which has traditionally played the role of regional leader and continues to seek to do so with some success, particularly in global advocacy on climate change. Fiji currently holds the Presidency of the COP23 UN negotiations on climate change. As Suva hosts the Pacific Islands Forum, the University of the South Pacific (the regional university) and other regional organisations, Fiji is often better able than Papua New Guinea to persuade the rest of the world that it represents the Pacific Islands region.

Papua New Guinea’s foreign policy has been driven by Prime Minister Peter O’Neill. In the first few years of his prime ministership, Peter O’Neill was active in promoting Papua New Guinea to the world, impressing foreign leaders with his can-do leadership style and PNG’s strong economic growth story. O’Neill worked particularly hard on improving relations with the Australia Government, and in turn it was prepared to work more closely with the O’Neill government than had been the case during the Howard-Somare years. While relations with Australia have been coloured by the Refugee Resettlement Arrangement since 2013, O’Neill has maintained close ties with successive Australian prime ministers. O’Neill also worked to improve PNG’s relations with its nearest neighbour, Indonesia, hosting a visit by President Jokowi in May 2015 and expanding relations with several Southeast Asian states, including the Philippines and Thailand, in addition to seeking a more substantial relationship with China.

China’s Ambitions In Papua New Guinea

The growth of China’s interests and influence in the Pacific Islands is the biggest story of the decade in the region. In the past few years, China has become the region’s second-largest trading partner and a significant investor. Although China delivers aid very differently from the region’s traditional donors and mostly through loans rather than grants, Lowy Institute research shows that China could be the region’s third most significant aid partner. It is a remarkable advance from the situation a decade ago when China’s interests in Pacific Island states were largely motivated by its competition with Taiwan for diplomatic recognition and its aid contributions characterised as ‘chequebook diplomacy’.

China’s presence in the region has undergone a significant shift over the past decade. Beijing now competes with more established players such as Australia, New Zealand, and France for influence with Pacific Island governments. But while China’s interests in Pacific Island states appear to be substantial, it is worth recognising that these interests are only a small element of the global story of China’s rise. China is the world’s leading exporter, is seeking to be a more relevant aid partner in the developing world, and is growing its portfolio of foreign investments. No Pacific Island country ranks in China’s top 50 trading partners. Papua New Guinea is ranked 124 on the list of countries China exports to and 66 on the list of countries from which China imports goods.

Papua New Guinea’s size and its resources sector make it China’s most significant partner in the Pacific Islands region. China–PNG trade totalled some US$2.3 billion in 2016. This represents about a twelvefold increase since 2000. While PNG’s trade with Australia is worth considerably more than its trade with China in 2016, China’s trade prospects are on a growth trend and Australia’s are declining. China’s direct investments in Papua New Guinea totalled US$496 million in 2015. Chinese investment and the Chinese nationals who work in Papua New Guinea on Chinese projects tend to attract much attention but the value of these projects is not about to overtake the value of individual investments of major resources companies or Australian foreign direct investment.

According to Lowy Institute research, China’s aid to Papua New Guinea since 2006 totals approximately US$632 million. This pales into insignificance if compared with cumulative Australian aid to Papua New Guinea over the same period (in excess of US$3.4 billion). However, the majority of China’s aid is delivered through loans, so cannot be directly compared to aid delivered by other partners. Chinese aid includes projects in vocational training, communications, fisheries, agricultural technical cooperation, and infrastructure such as a military hospital upgrade, university dormitories and roads. China has a patchy record of aid project implementation in Papua New Guinea, with some projects such as university dormitories praised for their high quality and other promised infrastructure not ever delivered.

Beyond its trade, investment and aid links, China has a diaspora, both old and new, in Papua New Guinea, which has helped to expand its influence. It has also invested in soft power, including in television broadcasting and in scholarships, which signals its interest in building a long-term relationship with the people of Papua New Guinea.

Chinese aid, trade and investment has traditionally been perceived in Papua New Guinea to come with ‘no strings attached’ but that assumption has been challenged in the past two years. While China has made more loans available to Pacific Island countries, Papua New Guinea has not rushed to take these up, cautious about the debt obligations that will follow. Prime Minister Peter O’Neill visited Beijing in July 2016, during a period where Chinese diplomats had been putting pressure on Pacific Island states to support its position in the South China Sea. For the first time, O’Neill agreed to respect China’s position and agreed to the issue of a joint press release that asserted China’s “legitimate and lawful rights and interest in the South China Sea, and its right to independently choose the means of dispute settlement in accordance with law”. Although O’Neill clarified that Papua New Guinea thought maritime disputes should be resolved under international law, his apparent bowing to China’s pressure on this key strategic dilemma for the Asia-Pacific was a departure from PNG’s longstanding tradition of avoiding involvement in great power debates or aligning with Australia and other Western powers.

China’s willingness to put public rather than private pressure on Papua New Guinea to align itself with its position on such a critical strategic issue suggests that it is no longer content with its image as a generous and altruistic partner and will be making more public calls on Papua New Guinea for support for United Nations votes or in other regional disputes. A more demanding China could create difficulties for PNG’s ambitions to strengthen its relations with other East Asian states.

What Is Driving The Interests Of Other New Players?

Growing trade ties between Papua New Guinea and East Asian states beyond China often go largely unnoticed in debate about PNG’s international profile. According to IMF data from 2016, Asian states comprise seven of PNG’s top ten trading partners, with Singapore second, China third, Japan fourth, Taiwan sixth, Malaysia seventh, India eighth, and Thailand tenth.

With the $19 billion PNG LNG project coming on line in May 2014 PNG’s exporting landscape has dramatically changed, with Japan, Taiwan, and China competing with Australia as primary exporting markets for Papua New Guinea.

With Asian countries such as China, Singapore, and the Philippines offering more opportunities for education, training, trade, and technical cooperation, PNG’s attention is increasingly directed to Asia. Asian businesses, large and small, have been setting up in Papua New Guinea in recent years and helping to strengthen ties with Asia. Increasing numbers of workers from Asian countries have been coming to Papua New Guinea for employment over the past five years, with Philippines, India, China, and Malaysia the main source countries. PNG students have been increasingly seeking out education in the Philippines as it is cheaper than Australia and has the advantage of English-language instruction and direct flights. In turn, the Philippines has become the second-largest source of foreign workers for Papua New Guinea.

While PNG’s trade relationships with East Asian countries are growing, the interests of these countries in Papua New Guinea are as yet largely limited to trade, investment, and employment. There are opportunities to strengthen technical cooperation and education links that could be of significant benefit to Papua New Guineans but these sorts of ties are only in the very early stages of development.

Influence Of Non-State External Actors

The resource-dependent nature of PNG’s economy means that major resources companies wield influence in Papua New Guinea exceeding that of nation state partners. This influence matters because the actions of major resources and logging companies play a critical role in determining the trajectory of the PNG economy. The direction of PNG’s exports and the development of future investment potential are largely determined by a select group of major foreign investors in Papua New Guinea which helps to guide the government’s foreign and trade policy priorities. This gives multinational and foreign companies strategic significance in Papua New Guinea that deserves greater recognition.

In addition to their extraction activities, resources and logging companies fulfil a role that in most nations would be more properly assumed by the state, for example building infrastructure, and delivering health and education services in the communities in which they operate. Foreign investors in Papua New Guinea are expected to deliver on social development outcomes in the rural areas in which they operate as part of the agreement they make with government when they invest. This has been the case with a number of major companies, including Oil Search, Ok Tedi, Steamships, Rimbunan Hijau and, latterly, ExxonMobil. The size of their investment and the contribution multinationals make to national development priorities makes it difficult for the PNG Government to resist their influence.

While many multinational or foreign companies in the resources, logging, and finance sectors wield influence in Papua New Guinea, the size and scope of US multinational ExxonMobil’s investment gives it a dominant position in the country. ExxonMobil’s initial investment in PNG LNG exceeds US$19 billion. Its operations, which commenced in 2014, include gas production and processing facilities, onshore and offshore pipelines, and liquefaction facilities.

ExxonMobil ships liquefied natural gas from Papua New Guinea to customers in Asia. In 2016 ExxonMobil produced 7.9 million tonnes of LNG — an increase of 14 per cent from the original design specification of 6.9 million tonnes per annum. The company employs 2500 people, 80 per cent of whom are Papua New Guinean nationals. In the rural communities in which it operates, ExxonMobil has invested more than PGK 800 million (US$247 million) on building infrastructure and developing social programs focusing on education, health and environment, women’s economic empowerment, and agriculture. The company also invests to improve access to education and in a community health program in its project areas.

The size of Exxon’s investment in Papua New Guinea exceeds the current size of the stock of Australian foreign direct investment in the country. Combined with the representation of exports from Exxon’s operations in PNG’s annual exports, Exxon could be considered a more significant economic and strategic player in Papua New Guinea than Australia. It already is clearly more important to Papua New Guinea than any one Asian nation, including China. Exxon’s influence is evident not only through the close relationship it has to have with the PNG Government and its contribution to the direction of trade, but also through its ability to determine confidence in the PNG economy and to inspire or dissuade other new investments in Papua New Guinea.

Corporate influence on government is by its very nature opaque, is exercised during private meetings, and usually excludes the public. Managing the diverse range of demands and advice from corporate players is challenging for PNG ministers and officials. But the PNG Government could do more to ensure that the influence of foreign investors delivers results for the people, not financial returns for individual decision-makers.

Likely Impact Of PNG’s Hosting Of The APEC Summit In 2018

Hosting the APEC Leaders’ Meeting offers a unique opportunity for the government and business community of Papua New Guinea to market the potential of the nation to other APEC nations. It will be the first time Papua New Guinea hosts a summit of this size and significance and the first time it will host international media beyond the region.

If leveraged to its maximum benefit by the PNG Government, successfully hosting the summit could assist in raising PNG’s profile in the APEC region and improve awareness of PNG’s economic potential. But if it is poorly managed, PNG’s hosting of the summit is more likely to reinforce the image of Papua New Guinea as an outlier in APEC and worse, raise doubts about its reliability as a trade and investment partner.

It is already clear that Papua New Guinea cannot afford to host the APEC Leaders’ Meeting in 2018. Backing out of its commitment is highly unlikely at this stage. Public criticism is likely to persist, given that budgets for essential government services are under huge pressure and already being diverted to pay for an event that provides no immediate direct benefit for the population.

The Australian Government is contributing approximately one-third of the costs of hosting the Leaders’ Meeting. Papua New Guinea has reportedly budgeted PGK 800 million (A$330 million) for the APEC summit. This does not include the construction of the purpose-built APEC Haus convention centre, which is being constructed by LNG producer Oil Search through a tax-credit scheme.

Papua New Guinea has form on poor budgeting for events. Its expenditure on hosting the Pacific Games in 2015 came under considerable domestic criticism. Many of the venues were unfinished or only just finished when the Games began. But more worryingly, the government cut budgets for essential services to ensure construction of Games venues was finished. This pattern has been repeated, with health and education budgets said to be taking a hit that they cannot afford and which will cause suffering in the rural population.

The PNG Government will need to work harder to persuade the population that there are long-term benefits to the nation in using this event to enhance its links with Asian partners and build international interest in Papua New Guinea. Working closely with the business community in this task, as the O’Neill government is doing, should help but more transparency is also needed.

Prospects For Improving The Australia–PNG Bilateral Relationship

Australia’s relationship with Papua New Guinea appears to be strong on the surface. Australia’s High Commission in Port Moresby is one of the largest Australian diplomatic missions in the world and has more attachéd agencies than any other mission, demonstrating the breadth of Australian Government engagement with Papua New Guinea. A bilateral Papua New Guinea Ministerial Forum is convened on an annual basis. There are numerous bilateral agreements supporting the relationship. Trade, investment, defence, and aid ties are strong and enduring. Australia enjoys a dominance in the delivery of aid to Papua New Guinea that is almost unheard of in international development (see Figure 2). Australia’s Department of Foreign Affairs and Trade describes the bilateral relationship as an “economic and strategic partnership”.

Figure 2: Aid flows to Papua New Guinea

In the 2016 Australian Defence White Paper a high priority was placed on Australia’s defence relationship with Papua New Guinea. The White Paper committed to “increase [its] cooperation with the Papua New Guinea Defence Force and Department of Defence in the decade ahead”. After a secure Australia, the White Paper identifies Australia’s second strategic interest as a secure nearer region including Papua New Guinea and says Australia will continue to be PNG’s principal security partner. The White Paper also asserts that “geographical proximity means the security, stability and cohesion of Papua New Guinea contributes to a secure, resilient Australia with secure northern approaches”. Despite weaknesses in the capacity of PNG’s security forces, the Australia–PNG defence relationship is a strong one and has potential for growth.

Australian investment in Papua New Guinea totalled almost A$18 billion in 2016, of which A$15.8 billion was foreign direct investment. Bilateral merchandise trade was worth A$5.3 billion in 2016. According to data collected by DFAT, Australia was PNG’s largest source of imports and second-largest export destination in 2015.

Australia will spend approximately $546 million in official development assistance or “aid” to Papua New Guinea in 2017–18. This is almost $200 million more than Australia will spend on aid to Indonesia, the second-largest recipient of Australian aid over the same period. Australia’s complex aid program supports three broad objectives: promoting effective governance, enabling economic growth and enhancing human development. Although the PNG economy is not aid-dependent, Australian aid is still in high demand.

With strong pillars holding up the bilateral relationship, the future of the relationship under the new O’Neill government has good potential. But there are fissures in the relationship. The Refugee Resettlement Agreement signed by Prime Ministers Kevin Rudd and Peter O’Neill changed the balance of power in the bilateral relationship. Canberra’s dependence on O’Neill to continue to detain asylum seekers and ensure they never entered Australia gave the PNG Prime Minister confidence to dictate terms in the relationship and made it impossible for Australian ministers and officials to say or do anything about allegations of corruption against the O’Neill government. And until the fate of asylum seekers on Manus is certain, the issue will remain a barrier to genuinely improving the bilateral relationship. Limited public awareness of Papua New Guinea in Australia and the tiny size of the PNG diaspora in Australia means there is not a strong lobby group to push Canberra to improve relations.

However, even if relations can be improved under a new government, there are likely always to be tensions. Australia’s colonial legacy and the contemporary breadth of coverage of Australia’s aid program means the Australian Government will likely remain a convenient whipping boy, rightly or wrongly, when things go wrong in Papua New Guinea. The difficulties Papua New Guineans have in obtaining visas to visit Australia are highly unlikely to be addressed during the term of the next PNG Government and will continue to be an irritant in the bilateral relationship.

Challenges For A New PNG Government In Managing Growing Interests Of Existing And New Players

The new O’Neill government faces very different challenges following this election to those it faced following the 2012 elections. The fast-declining national economy, combined with major failings in funding essential service delivery — particularly in health — creates a sense of urgency for action. Allegations of corruption against O’Neill himself have yet to be addressed in court and will remain a festering sore on the Prime Minister’s leadership. The rural majority has found ways around the elections to protest its frustration with the government’s failings to deliver even basic development and is likely to continue to voice concerns, especially as there is little chance things will improve. The business community continues to protest restrictions on foreign exchange, which appear to have no resolution. The short-term outlook for the country is decidedly negative.

The government will be tempted to look for quick funding fixes. Seeking new loan arrangements from the multilateral banks or even from China could be on the agenda. Another approach to Australia for budget support is also likely. The government will continue to seek private sector support for building infrastructure and for service delivery.

The government will need to focus on attracting new investment in resources at a time when global prices for PNG’s resources are low. With a crisis in health funding forcing serious cutbacks in hospital and other critical health services, the role of the private sector in assisting the government to deliver health services to the communities in which they operate will become even more pronounced.

Readying Port Moresby to host the APEC meetings in 2018 will be an immediate priority. Cost over-runs are likely, even with Australian support.

Despite its financial problems, the good work the PNG Government has done in expanding relations with Asian states in recent years means there are opportunities to deepen trade and investment ties with the stronger economies of East Asia and with India.

Managing Beijing’s expectations provides its own challenges. China is likely to exert pressure on a weak Papua New Guinea to again support its questionable international actions in the South China Sea. Australia has concerns about China’s growing influence in the region and in Papua New Guinea, which may create new tensions in the Australia–PNG relationship if Australia seeks to put the brakes on China’s capacity to influence the PNG Government. Other East Asian nations, particularly Japan, are also concerned about how China exerts its influence in the region. Papua New Guinea will need to ensure it is maintaining friendly relations with all its partners and avoid being drawn into disputes.

Papua New Guinea does not have sufficient resources right now to expend on enhancing its diplomatic profile in Asia. It should focus on strengthening trade and investment ties and encouraging technical cooperation and education links which will provide more opportunities to its population. To this end, the PNG Government would benefit from seeking to facilitate more development cooperation between China and other bilateral partners to help the people of Papua New Guinea. This would make it clear to China that its domestic development takes priority over any involvement in international disputes and enable Papua New Guinea to better determine its own foreign policy.

Conclusion

Managing a range of existing and evolving foreign interests will be difficult for a financially constrained O’Neill government that is rightly preoccupied with more important domestic challenges. But for all the difficulties, there are also opportunities. Hosting the APEC Summit in 2018 will bring a concentration of international attention to Papua New Guinea’s potential that would otherwise take years to attract. Much good preparatory work to strengthen relations with Asia has already been done. Papua New Guinea maintains the respect of other Pacific Island countries and could seek to lead on regional issues where Fiji cannot. Papua New Guinea’s economic fortunes are suffering now but there are good long-term prospects being recognised by international investors. Continued growth in trade and investment links with China can assist in spurring economic growth in Papua New Guinea. Australia will remain Papua New Guinea’s closest partner, friend, and protector but there is work to be done on both sides to improve the bilateral relationship and deliver better dividends from Australia’s commitment to Papua New Guineans.

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