Our new northern exposure

October 18th, 2010

IT has a population of 6.3 million. It is one of Australia's two really large recipients of aid.

We are its largest trading partner. It is our 19th. It's about 400 times closer to us than New Zealand.

Yet for some reason our media and public discourse doesn't seem to rate the importance of Papua New Guinea.

For much of the 20th century Australia had responsibility for the administration of some or all of PNG.


Aside from the historical connection that establishes, at a human level it now means that almost everyone knows someone who has spent time in PNG.

Battles have been fought on PNG's soil which go to the core of the Australian identity.

With the exceptions of New Zealand and the UK, there is no other country in the world with which Australia has such a deep historical and social connection.

With that connection PNG deserves our attention. PNG deserves to be understood. And the bilateral relationship at a government level deserves all the public scrutiny that great matters of policy need.

There is much in this relationship that is worth talking about.

Australian aid in recent years has provided 539,000 primary school text books around the country. It has been part of a push which has seen an increase in the rates of primary school participation from 41.5 to 56.9 per cent. Sixty per cent of the program to combat the spread of HIV is funded by Ausaid with more than 6000 people having been supported by anti-retroviral therapy by the end of last year.

More than 2000km of roads are being maintained with the support of Australia, providing invaluable infrastructure. This includes the Lae-Goroka road: the busiest highway in PNG.


But, of course, the expenditure of $470 million in aid must come with an obligation to ensure that Australian taxpayers are getting value for money and that Papua New Guineans are seeing real benefits. Both governments have commissioned an independent review of our aid partnership which is an intelligent document that will ultimately see the spread of our aid narrow and a greater emphasis on grass roots service delivery.


We have agreed to consider an economic co-operation agreement - an important step to changing the paradigm of a relationship previously based on aid.


A sign of this change is PNG's resources boom and, in particular, the Exxon-Mobil LNG project.


This is a US$15 billion project that at the height of its construction will employ 12,000 people and increase PNG's GDP by up to 20 per cent.


In its own right, the LNG project has the potential to transform the country. Already it's transforming our bilateral relationship.

Australia has extended a $US500 million loan facility to the project: not as an act of aid but rather a commercial decision in the Australian national interest. Australian companies have won $A1.3 billion worth of contracts in the construction of the project with many more opportunities still to come.

A project of this size generates its own gravity. It needs, for example, the same number of truck drivers as there are in the whole of PNG. Thankfully, Exxon-Mobil appears to be approaching this with a view to training more truck drivers rather than simply poaching all the existing ones.

Yet it highlights that if the LNG project is not done right it could be as much of a curse for PNG as a blessing.

The resources boom has seen PNG's GDP grow by 5.5 per cent last year and an expected 7.5 per cent in 2010. These are numbers that would be the envy of any country in the developed world.

But it is essential for PNG that the growth in this wealth is translated into real prosperity for ordinary Papua New Guineans. It is a challenge which will be difficult to meet and in this regard Australia has a role to stand by PNG as a friend and to lend a hand.

PNG has an emerging economy, an emerging population and is already a significant emerging nation in the Pacific.

Australia welcomes this. It is in our interest to have another large partner to help us and the region assert our position in the world. And, as a close friend, we will stand side by side with PNG to help it meet its national aspirations.

With so much going on in our northern neighbour, now is the time for the Australian media to emerge with a rightful degree of attention to Papua New Guinea.

_ Richard Marles is the Federal member for Corio.