Can PNG avoid becoming a failed state?
17 October 2021
TUMBY BAY - While the Covid-19 pandemic wreaks havoc, misery and death across the world, it is also serving to highlight major shortcomings in governance almost everywhere.
This is nowhere more prominent than in nations that have chosen the path of neoliberalism, with its emphasis on economic growth and the market and belief that government should keep out of the way and let society look after itself.
In Australia the Covid contagion has brought into sharp focus the sorry state of our health and allied services in the wake of successive government privatisations and zeal to slash public health budgets.
In Papua New Guinea, which is now entering an deadly and deeply worrying phase of the pandemic, a penetrating light is being shed on what can fairly be said to be a failure of the whole of government.
This catastrophic failure can be ascribed without any doubt to the corruption, greed, ineptitude and indifference of the ruling elite.
It appears that, although PNG is not yet a failed state, the pandemic may – and quite quickly - catapult it into that unenviable situation.
And I thank Dan McGarry in Vanuatu for reminding us that a state fails when conventional action to restore stability is largely futile because there is no state, worthy of the name, to interact with.
PNG has been steadily moving towards being an unmanageable state for many years.
The Fund for Peace, an American think tank, takes a special interest in such countries, which it now calls fragile states.
Fragile states have a weak and ineffective central government, they lack public services, there is widespread corruption and criminality, and they are in economic decline.
Since 2005, the Fund for Peace has published a highly regarded annual index of fragile states (it was formerly called the Failed States Index).
The index uses 12 factors to determine a rating for each nation. The factors include social cohesion, economic decline, uneven economic development, state legitimacy (lawful governance), public services, human rights, the rule of law and external influences.
It is worth evaluating where PNG is placed in relation to its strength and fragility in each category.
Considering each factor, Fund for Peace calculates a score for each nation ranging from 0 to 100.
Zero represents a totally sustainable and stable nation and 100 represents a totally failed nation.
The nation with the best stability in 2021 is Finland with a score of 16.2. The nation with the worst is Yemen with a score of 111.7.
Afghanistan comes next with a score of 102.1, the recent success of the Taliban making that fragility even more perilous.
Australia has a score of 21.8 (sustainable), New Zealand 18.4 (very sustainable) and the USA 44.6 (stable).
Papua New Guinea has a score of 80.9 (described as an 'elevated warning'), which is on the brink of slipping into the high warning classification. It has hovered around this mark for many years.
There seems every prospect of PNG edging into the high warning category in 2022 as the pandemic devastates the nation and politicians stand by prioritising their own, not the nation’s, welfare.
Next year also sees a general election and it is likely the usual bribes, intimidation and vote-rigging, when added to the impact of Covid, will worsen the nation's social, economic, political and cohesion indicators .
When faced with such reports and statistics, the usual response from Papua New Guinean politicians and elites is that Western standards of measurement are irrelevant because of cultural and lifestyle differences.
There is some truth in this contention, particularly when it relates to economic matters. The global financial crisis of 2007-2008, for instance, washed over the average Papua New Guinean with little impact, especially in rural areas.
The difference now, however, is that the pandemic represents a comprehensive crisis for which the nation is unprepared.
Lives and livelihoods are at risk for rich and poor, young and old, and urban dweller and villager.
And, unless you are wealthy enough to flee the country, there seems no escape from the pandemic’s consequences.
The other well-trodden excuse of blaming external influences doesn’t wash either.
PNG is not alone in being affected by Covid. It’s not in the minority. It’s not special.
Covid has threatened every nation and the world quickly learned that blaming the Chinese wasn’t going to help.
Every nation responded in its own way to the crisis.
No nation reacted perfectly and we are now beginning to see which nations seem likely to have been more successful.
Papua New Guinea, for most of the last 18 months, showed complacency, avoidance and denial when it needed to be getting ready.
Indeed, for much of last year, almost inconceivably, very many Papua New Guineans believed they had some special protection from the virus.
They watched on as the pandemic travelled around the world, devastating country after country, and did little to prepare for the inevitable time when Covid would infiltrate and gain control of their country.
As the nation now spirals towards the high warning category that marks the descent towards becoming a failed state, blame rests only at the feet of the politicians.
In addition to dealing with the daily crises PNG now faces, these same politicians should be planning how to make the country safe, not just for themselves, but for nine million people who need them to do much better.
No easy solutions, whether political or administrative.
"The inflation rate in Germany, measured as the year-on-year change in the consumer price index (CPI), stood at +7.4% in March 2023. In both January and February 2023, the inflation rate had been +8.7%."
"The rate of inflation [in Germany] has slowed but remains at a high level".
Meanwhile in report from BPNG, "Inflation Rate in Papua New Guinea decreased to 3.41 percent in the fourth quarter of 2022 from 6.25 percent in the third quarter of 2022."
Posted by: Lindsay F Bond | 26 May 2023 at 12:21 PM
Failing Government System in PNG
In recent mass media news reports, there were concerns raised by leaders in various government agencies that governing systems were failing.
This is bad for Papua New Guinea (PNG) as a developing nation if it is to achieve its developmental goals enshrined in Vision 2050.
There are several reasons that have contributed to failing governance systems. In the following discussion, the main contributing factors are being discussed in length, and providing with strategies which the government can adopt to address these issues for to make the governance system work effectively.
Firstly, and most pressing issue is the higher prices of goods and services that is felt by the citizens of this developing country, Papua New Guinea. For example, previously diesel was K2.90 per litre in 2012 and now increased to K4.45 per litre in June 2022. Now further increases to K4.50 per litre. This is due to high inflation rate in the economy. Inflation simply refers to an increase in prices of goods and services over time, resulting in the loss of buying and selling power for customers.
The impact of inflation can be very severe as every Papua New Guineans are going through, where many people are living below the poverty line and struggling to meet their daily needs as prices of goods and services are increasing rapidly.
One of the primary causes of inflation in Papua New Guinea is excessive government expenditures on paper contracts. Government often resort to printing more money for their spending, though the blame goes to Russia-Ukraine conflicts and Covid-19, which leads to an increase in money supply and eventually inflation.
Papua New Guinea has a history of high government spending, with large investments being made in infrastructure projects. While these investments may be necessary for the country’s development, they also contributing to inflation by putting more money into circulation.
Furthermore, heavy reliance on imported goods and services is another cause of inflation in Papua New Guinea today. As a smaller island nation, Papua New Guinea can import many of the goods and services it needs.
When the value of country’s currency declines against foreign currencies, as often happens in periods of inflation, the costs of imported goods increases. This in turn drives up the prices of local goods and services, leading to inflation.
High inflation rates reduce the value of people’s savings and reduce the purchasing power. This is leading to lower standards of living, increased poverty rates, increases social unrest in both rural and township, which PNG is experiencing today.
Moreover, businesses shutting their operations like Lae Biscuit company, and investors are less likely to invest in the country due to the risk associated with inflation. This is now limiting the economic growth and developments, further exacerbating the country’s economic problems.
So, to address these issues, the government needs to take steps to control its spending by cutting down expenditures on imported goods and promote domestic production of goods and services. Also, foreign investment should be encouraged to help diversify the country’s economy and reduce reliance on imports.
By taking this approaches, Papua New Guinea can work to restore its economic stability and improve people’s lives.
Another factor that is crippling the economy of Papua New Guinea is government’s mismanagement on public funds. The government is mishandling the economy by unnecessarily creating all kinds of entities which were previously run under one department.
As this is the cause, huge amount of money is being consumed into those areas which is a waste of public funds.
For instance, like for the department of civil aviation, there are four entities:
(1) National Airports Corporation (NAC) looking after all the 21 airports (major airports) in the country,
(2) Civil Aviation Safety Authority (CASA), which is the regulator of all the airports in the country,
(3) NiuSky Pacific Limited, which is another organisation that is responsible for looking after and collecting fees for other planes from other countries for using PNG’S airspace, and
(4) is the Air Investigation Commission (AIC), which is the body that investigates any plane crushes. So, all these four (4) organisations are coming under one- Civil Aviation Sector.
Previously it used to be the department of Civil Aviation, or Civil Aviation Department, and only four directors look after all of those, which is cheaper to look after in terms of public service salary.
But now, what Marape government has done is, when they created those entities, they are like companies comprised of managing directors, deputy managing directors, and general managers which are very highly paid, and summing up with the salary expense for the staff and other bottom line workers of each of those four entities, the government is spending very significant amount of money.
And that is why it is consuming a lot of money there which is a waste of public funds. That is one area that the government should have saved money. If it was one department (in this case Civil Aviation Department) running them then, those four entities should be looked after by four directors, or First Assistant Secretaries (FAS), and then some staffs working under, and that is more-cheaper to look after.
As the economy is in dire need today, government needs to look into such areas and cut down those unnecessary costs and use those money for other government’s priority areas like health, education, and infrastructure.
Another example is like PNG Power. PNG Power is seen as a liability to the government. Every time government is subsidising PNG
Power to run because it cannot make its own money. PNG Power should be a self-income generating entity but it does not. Why? This is simply because all the revenues generating are being consumed by the staff. Managing directors, CEOs, and all the other officers down the line are all being highly paid. Much of the money is being wasted here.
This entity, PNG Power, supposed to be the department of Petroleum & Energy, but not. And, now they have created another entity called National Energy Authority (NEA) which they are trying to put in those other power related areas like harnessing renewable energy and downstream gas industry to be administered under this new authority which is not right as it is going to consume a lot of money. It should just come under Department of Energy, with one secretary, and then some of those deputies and directors so that they look after PNG Power and other energy related areas. In this way, government will safe cost in that department.
Finally, one of the very main factors that is contributing to the failing governance system in Papa New Guinea is non-other than corruption. Rampant corruption at all levels from public (government) sector to the private sector is the main impediment towards the progress of this nation.
As PNG is well associated with multi-cultural groups with abundance of availability of valuable resources, the country should have been fully developed some decades back. Yet, PNG is still in poor state.
This is simply because of corrupt practices of the so-called leaders, especially parliamentarians. Thus, these bad practices at highest level leads to stagnancy in terms of economic growth of the country. Particularly, political corruption is hereby described as use of position of trust (power) for dishonest gain or personal interest.
Most of the people think that being parliamentarians means to build one’s empire because every elected member in parliament now a days are likely doing so.
Meanwhile, the most common and well-known bad practices being practiced which fuelled to existing corruption by our leaders are nepotism (wantok system) and bribery.
These unpleasant systems dwelling in all levels of government systems and processes have been seen as root cause of various issues dramatically evolving throughout the nation like increased unemployment, acceleration of goods and services price, over borrowings and deficit budget.
These are all happening because elected leaders as well as bureaucrats in the higher offices have been promoting corruption by performing their duty with dishonest and greed.
Stealing, bribery, nepotism and favouritism for their self-interests and, or political interests, all have caused setback and downfall rather than being progressive and prosperity in achieving some of the major goals and objectives in the country.
Therefore, government should need to take steps ahead and put forth some specific measurements in place purposely to eradicate the corruption. This could be targeted when constitutions that were outlined and amended under democratic governing system in PNG must be reviewed.
Just because of freedom, people take advantages and do things according to their own will because they without doubt, know that they will be safe because the law (mama law) itself and law enforcement bodies are so weak in this country.
To conclude, it is understood that there are many more factors which are becoming detrimental to the progress of this nation. But the main factors that are heavily contributing are excessive government spending, mismanagement on public funds, and corruption practices by our so-called leaders.
This nation is facing economic doldrum as a result of growing expenditure with slow and lower revenue collections. Higher rate of inflation leading to skyrocketing of the prices of goods and services, and other issues like increase in crime rates, increased unemployment, rural urban drift, and the list goes on…
To address these pressing issues, the government really needs to get to the bottom and fix the root causes. Systemic corruption, mismanagement and overspending are the root causes of all the other effects that are being felt on our economy. In doing so, the effects or indicators will go away.
Posted by: Danny Andrew (Kandepen Vickings) | 26 May 2023 at 11:01 AM
PNG is becoming a failed state because of corruption, greed and power in high office not only involving politicians but the public service machinery, businesses, churches and others.
The whole management system is doomed to fail and we cannot do much to reduce the magnitude of the problems.
There are political, economic, social and spiritual problems that affect the fabric of our society. Problems do not exist on their own, there are people causing them and those people have to be dealt with.
The people causing the problems know the solutions but they are allowing the problems to get worse.
Diseases like Covid-19 should not be allowed to create so much anxiety and panic in PNG. When there are problems like disease and famine, in PNG politicians and bureaucrats benefit from them by diverting funds for their own use rather than solving the problems.
I had this irrational thought, does a loving God really care for his people who are suffering and dying. Why God allows suffering so we enjoy life in Heaven. We hope for a divine intervention that corrupt people transform their lives or something else should be done to them.
Posted by: Philip Kai Morre | 17 October 2021 at 02:29 PM
Where does Lebanon sit on this rating?
If Lebanon can pull itself out of it's current morass and restructure itself as a future democratic viable state then there is hope for many others who find themselves in similar situations.
Lebanon scored 89, somewhat worse than PNG's 80.9 - KJ
Posted by: Harry Topham | 17 October 2021 at 10:51 AM
Sound out, sweet clarion, coming to tally those done.
Posted by: Lindsay F Bond | 17 October 2021 at 10:05 AM
Here's a link providing access to a forthcoming Zoom symposium entitled, 'Imagining a World Without Corporate Criminal Law':
The symposium takes place next weekend at the Georgetown Law School in Washington DC.
Meanwhile, here's another interesting link that exposes more revolving doors and the installation of defective Takata airbags in motor vehicles:
Posted by: Bernard Corden | 17 October 2021 at 08:48 AM