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Papua New Guinea

PNG in dangerous waters

The incident last week in which a Chinese warship focussed a laser on an Australian RAAF aircraft off Darwin has wider consequences, especially for Papua New Guinea.

The two Chinese vessels travelled through the Torres Strait….meaning they were within a short distance from Daru and the Papuan coast. I had hoped the incident would attract attention in PNG – sadly, hardly a mention in the local media and no political comment.

The problem in PNG today is that national security, and border surveillance, simply don’t rate as key issue as PNG’s election campaign is about to be formally launched.

When the Chinese vessel sailed past Daru, and along the coast towards Ihu-Kikori, the ships’ captains may well have told their crew – these ports will soon be ours!

If they are, then Chinese navy vessels in the Gulf of Papua and the Torres Strat will be almost daily occurrences. No major political party in PNG has a substantial policy on it…none!

This suits China perfectly. It has already locked in a claim to the Ihu-Kikori Special Economic Zone, and building a major fishing processing factory on Daru remains very much alive. Progress might be slow, but it remains a priority for the PRC Embassy in Port Moresby.

Just how much these proposals – right on our northern doorstep – progress may well depend on the upcoming PNG elections. The Marape Government has done nothing whatsoever to discourage these projects so strategically located.

png china australia
Prime Minister of Papua New Guinea, James Marape (left) and Prime Minister of Australia, Scott Morrison (right). Picture: Wikimedia

If Australia has objected then there are no signs it has been successful. Indeed in recent weeks Prime Minister Marape signed up to a wide-ranging agreement with the Chinese Premier that focusses on infrastructure, ports, fishing and agriculture. China is already dominant in PNG in electricity expansion, communications, and a range of other areas so great they are almost impossible to monitor.

The one certainty is there has been no retreat, just a total shift away from “aid” to Belt and Road type initiatives that by my latest calculation have seen PNG commit to at least K5 billion in tied-loan projects in the last six months alone.

The sad reality is that PNG’s capacity to repay loans has been reached, yet the borrowing continues. Close to $800 million owed to Australia in loans approved in the last two years as “budget support” are not being repaid with Canberra generously agreeing to “defer” repayment. But the debts remain and grow annually.

China would be carefully monitoring the capacity of PNG and state owned agencies to repay debts to China, which probably now exceed K10 billion. Any request by PNG to defer repayment or even have the loans forgiven is unlikely to find China as generous as Australia!

Most of the loans have been entered into by state owned businesses, most notably by the PNG Government, widely regarded as a financial “basket case”. But it keeps borrowing almost all from China, with the loans tied to all work being undertaken by PRC companies. Both PNG and Australian companies in the construction sector just don’t get a look in – and won’t.

The one area Australia can help PNG is in regard to border surveillance including the monitoring of sea lanes and activity in the extensive fishing zones around the PNG coast. The PNG nav y is small and under-resourced. Often the handful of navy vessels are tied-up in port because of poor maintenance or the incapacity of the government to fund fuel and other needs.

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As China increases its PNG presence the need for proper surveillance of shipping and aircraft movements grows. Any proposal by China to help in that area ought to be treated with suspicion. But only a pro-active approach by Australia can prevent that. If China gets a foothold in the surveillance and customs and customs areas then it would be like having the fox keeping an eye on the chook pen!

PNG needs training for customs and border surveillance staff. Australia is uniquely able to provide it.

These important national and regional security areas are under-funded to an alarming extent, and the weak PNG fiscal position just makes it worse.

This is an opportunity we should embrace and include a community education campaign on the importance of secure borders and proper surveillance.

This article first appeared in On Line Opinion and was used with permission.

Jeffrey Wall
Jeffrey Wall CSM CBE is an Australian political consultant and has served as an advisor to the PNG Foreign Minister, Sir Rabbie Namaliu – Prime Minister 1988-1992 and Speaker 1994-1997.

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