MICHAEL PASCOE | Sydney Morning Herald
WHILE THE AUSTRALIAN GOVERNMENT was auditioning on Thursday for a minor job with Ashton’s Circus (they were turned down), real news was breaking to our north.
Papua New Guinea’s prime minister reportedly announced his government would seize control of the $1.4 billion sustainable development fund set up by BHP in 2002 as a gift to the PNG people with a structure designed to try to prevent it being seized by the politicians of a country rated by Transparency International as one of the world’s most corrupt – ranked 150th out of 176.
This is the latest act in a saga of both tragedy and generosity. The Papua New Guinea Sustainable Development Program represents by far the biggest act of corporate philanthropy in Australian history.
When Anderson personally reviewed the studies commissioned by his predecessors of the Ok Tedi mine’s impact, he found it morally impossible to continue to operate the mine. The initial plan was to effectively fill the hole in, a scheme that would allow mining to continue for a little longer without polluting the river, giving PNG time to adjust.
But with Ok Tedi being the government’s biggest source of revenue, Port Moresby would have none of it. The mine would continue to operate as long as it was profitable.
Anderson nonetheless believed BHP could not ethically keep mining, so its majority stake was gifted to the people of PNG through the PNGSDP structure, a Singapore-based corporation with PNG government representation on its board, but not dominance.
New PNG Prime Minister Peter O’Neill last year began his push to take control of PNGSDP. Steadily rising tensions broke surface when PNGSDP chairman Professor Ross Garnaut was banned from entering PNG after he very gently stated the obvious about the country, that it was “tempting for political figures to think of better ways of using it right now rather than putting it into long-term development”.
Thursday’s development – O’Neill announcing that Ok Tedi’s lease would not be renewed upon its expiry next year, that the PNG government would own and operate the mine and that “we will restructure the PNGSDP with our own people managing it, not by strange people who live beyond and do not know our needs” – would be a sorry conclusion to a magnificent effort to ameliorate an environmental disaster.
There was hope that O’Neill becoming Prime Minister would help lift PNG and much of the new government’s rhetoric has been encouraging about removing some of the infrastructure bottlenecks holding this complex country back.
Certainly a good government could indeed put the PNGSDP funds to good usage, but good government to the benefit of all the people have not been the rule in PNG. Despite fabulous natural resources, delivery of services in many areas has gone backwards.
Giving O’Neill the benefit of the doubt, the tragedy here might not be what his administration might do with the money, but whatever crew takes over from him. It’s a tough job standing between a politician and a bag of money the world over, including Australia.
When the PNGSDP was set up, it was envisaged that it would ultimately be controlled by the PNG government. The timing and attempted safeguards could not be ensured a decade ago. The structure has at least preserved a large proportion of Ok Tedi’s wealth for the people. In the end, it is indeed theirs to deal with.
To have the structure end in rancour and high dudgeon though, bodes ill. Australia’s nearest neighbour and major destination of Australian aid funds has a great many problems as well as potential.