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‘If Australia fails to listen to PNG, we won’t have a good outcome’

Ben Doherty

BEN DOHERTY | The Guardian | Extract

An extract from a thoughtful piece by Ben Doherty on the Australia-PNG-China relationship. You can read the entire article here

SYDNEY - China’s aid spending in Papua New Guinea – with its focus on infrastructure and “few-strings-attached” concessional loans – risks eroding Australia’s influence in the country, with Australian aid sometimes viewed as paternalistic and unwieldy.

A Deakin University submission to a parliamentary inquiry, based on interviews with Papua New Guinean business, political, academic and community leaders argues Australia risks being diminished by rising Chinese spending.

PNG is Australia’s closest neighbour, and for reasons of proximity and a shared history – PNG was under Australian administration until 1975 – Australia has been its most significant international partner.

But China has recently dramatically increased its aid spending in PNG, with a particular focus on signature pieces of infrastructure and concessional loans.

According to the Deakin University submission, “those interviewed noted the differences of the structure, transparency and detail of Australian aid planning to that of the more opaque Chinese aid. For one interviewee, this made ‘Chinese aid more effective. Chinese aid is unconditional, no strings attached ... the government can use this aid more flexibly’.”

There was a view from some respondents that Australian aid – highly accountable, and focused on the human sectors, such as education, health and gender – was sometimes seen as paternalistic.

“It was also noted that “Australia’s influence has diminished considerably as a result of the rise in Chinese aid flows to PNG,” the submission says.

One of the authors of the submission, Prof Matthew Clarke, told the Guardian China’s aid to PNG was recognised there as a vehicle for increasing Beijing’s influence in the country, its trading sphere and leverage in the region.

“When it talks to PNG, China talks about a ‘south-to-south’ relationship,” Clarke said. “It sees itself as being a developing economy, as much more of an equal partner, which is well-received in PNG.

“And the type of aid China is offering also lends itself to the Melanesian context, the ‘big man’ political culture, where leaders can point to a piece of infrastructure and say, ‘look what I’ve delivered, look what I’ve brought’.”

Clarke said the PNG government was pragmatic about aid, and willing to play one donor off against another in order to achieve a desired outcome.

“There are probably two broad lessons: that this is not an issue that just involves Australians and China – that the voices and views of Papua New Guineans must be considered. If we fail to listen, we won’t have a good outcome,” he said.

“And that Australia needs to be smarter with its aid. For Papua New Guinean leaders, it is easier to critique the Australian aid program because another is there to compete and take its place.”

The parliament’s joint standing committee on foreign affairs, defence and trade is undertaking an inquiry into the effectiveness of Australia’s aid in the Indo-Pacific region and “its role in supporting our regional interests”.

Australia is the largest aid donor in the Pacific, with 90% of its $3.9bn aid budget directed towards partners in the Indo-Pacific.

But China’s growing interest has been followed by reports of plans to build military bases in countries such as Vanuatu, and its assertiveness in militarising atolls in the South China Sea is seen as a template for increased military influence.

Australia remains the dominant aid partner. The Lowy Institute estimates that between 2006 and 2016, Australia has dedicated $7.7bn in aid to the region, dwarfing China’s $1.7b. However, there are concerns over China’s rising interest.

The foreign minister, Julie Bishop, said small states in the region could be harmed by unsustainable debt through aid “loans”, with debt-for-equity swaps imperilling their sovereignty.

“We’re concerned that the consequences of entering into some of these financing arrangements will be detrimental to their long-term sovereignty,” she said.


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