China & India’s growing business links with PNG & the Pacific
Peter O'Neill faces leadership tribunal over Oil Search loan

Is going all the way with China such a good idea after all?

Peter O’Neill with Xi JinpingPHIL FITZPATRICK

QUITE often in the pages of PNG Attitude there are articles extolling Papua New Guinea’s burgeoning links to China.

The articles are often written by people who have benefitted from scholarships that have enabled them to study in China. 

Sometimes their enthusiasm is such that the churlish among us might wonder whether they have been effectively brainwashed.

Underlying the promotion of China is an often unspoken criticism of its greatest rival, the USA, and by extension its faithful little acolyte Australia.

In reality there is little difference between these two superpowers.  They both represent free-market capitalism and globalisation.

If you are looking for distinctions it probably lies in their different attitudes to military power. 

China appears to be trying to paint itself as a peaceful influence in the world (while still maintaining a large army and holding nuclear weapons) while the USA has appointed itself the world’s sheriff and, encouraged by its powerful arms industries, gets involved in all sorts of pointless and questionable military crusades overseas. 

This is not so much an issue for Papua New Guinea but it is a major concern for Australia and its sons and daughters who get killed in the process.

No matter which one you prefer one important fact to realise is that they are both as equally dangerous as the other.

This fact is most obvious when you consider the most urgent issue facing mankind today, the matter of climate change.  Climate change hasn’t just got the potential to destroy the planet, it is already well on the way to doing so.  The science is in and it’s irrefutable.

In contrast to the belief in so-called pagan societies that the earth is a fertile provider of life whose divinity subordinates mankind, the Judeo-Christian tradition believes the opposite.

According to Genesis it is mankind’s role to “be fruitful and multiply, and replenish the earth and subdue it: and have dominion over the fish of the sea and over the fowl of the air and every living thing that moveth upon the earth.” 

The Christian God is clearly a Capitalist.  The USA is overtly Christian and Christianity in China is growing rapidly in parallel with its capitalisation.

Solving, or at least effectively ameliorating the impending disaster of climate change has come down to a battle between Climate and Capital.

The bad news is that Capital is winning.

There is no way that the big corporations and rich elite who run them are going to let a small matter of a rapidly disintegrating planet get in the way of profit. 

Coal is good, clear felling carbon sequestering primary rainforest is good, even driving around in massively polluting cars, trucks, aeroplanes and ships is good, the list goes on.

Globalisation is the latest and most successful mechanism used by Capital to exploit diminishing world resources, make a buck and destroy the planet.

It had its birth in 1992 when moves to set up the World Trade Organisation (WTO) began.

Which brings us back to China and the USA, and most recently India and before that Japan, Taiwan and South Korea.

Like Papua New Guinea, Australia has been busy signing free trade agreements with these countries, all done in haste under the auspices of the WTO and the rules it enforces through the International Court.

As is its wont lately, Australia has blithely signed off on these deals without much thought about their actual consequences.  Or perhaps they’ve thought about it but are too scared to share the details with us.  I bet Peter O’Neill is doing the same thing.

Let’s look at an example.

One of the rules of these agreements is that the signatories do nothing to hinder the flow of free trade between themselves.  So a country like Papua New Guinea, subsidising its local farmers to develop viable agricultural projects would be in breach of such an agreement if similar unsubsidised projects existed in another member country.

If China ever decides to commercialise kaukau, which is not beyond the realms of possibility given its burgeoning population, Papua New Guinea will be in deep trouble.  Monsanto with its patented hybrid varieties of kaukau will also be out for blood.

Subsidising local manufacturers using tariffs is also a no-no.  This is why the Australian government was happy to kiss its automotive industries goodbye.  Breaches bring penalties and this has been tested and won in court several times.

In some cases manufacturers in one member country can sue the government of another member country if it thinks it is being disadvantaged.  We get cheap Asian cars and hundreds of Australians go on the dole queue, who cares?

It gets worse.

If a country like Australia decided to brings in laws to reduce its carbon footprint and begins to phase out polluting coal-fired energy generators, thus causing the closure of its coal mines, it could be in breach of its trade agreements and could be sued by member countries who rely on Australian coal to run its energy and manufacturing needs.

If Papua New Guinea decided to arbitrarily increase the basic wages of the local workers on the LNG project Exxon-Mobil could sue.

If a country like Papua New Guinea tried to curtail the unfettered logging of its primary rainforests and discourage its replacement with short-lived and inefficient carbon sequestering oil palm it could also be in breach of such an agreement because it would hinder the trade and profit of the Asian companies involved.

The end result?

The planet continues to die.  The corporate elite hidden in their fortress estates continue to revel in their obscene wealth, while all around them ordinary people wither, starve and die in the catastrophic climatic events that their greed has caused.

If you think it’s a great thing to get into bed with China or the USA you’ve got no one to blame but yourself when they roll over in the night and crush you to death.


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Busa Jeremiah Wenogo

Phil, an insightful commentary. Thanks for sharing.

I agree with your analysis that so often trade agreements have been signed in haste.

PNG is not immune to this fallacy where we have been recognised for ratifying and signing onto just about all trade agreements and conventions that get served to us.

That is why we have so many problems impacting our nation and societies as our government cannot keep up with the demand of these agreements.

We don't have the capacity both human and technology to provide for a fairer and more equitable environment when it comes to trade. As a result multinational companies have taken advantage of these agreements and our government's lax approach where they have been seen fit to roll-out the red carpet to them to come, exploit and take everything with them while majority of our people squabble over crumbs left in their tracks.

PNG, and other Pacific island countries for that matter, should ensure that trade with China or any other country should produce a win-win outcome.

The US and other developed countries for their part should be now seriously consider empowering these capital-less countries with the systems, infrastructure and technology that can generate capital to boost their economies.

These should then be supported by an international trading system that aims to boost tradeable and non-tradeable goods and services that work towards growing their economy.

Without such things in place it is highly likely that more of these countries will be lured by China at their own peril.

If the US and the so-called West truly care about these smaller countries and world peace in general, they should be willing and ready to sacrifice their own national prestige for the sake of the world.

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