Biden’s ‘build back better world’ partnership must be big and bold

The economic and social development of Papua New Guinea is in serious decline. The possibility of social discord simply cannot be ruled out.

The policy areas I outlined in my last contribution, such as strengthening democracy, lifting direct funding for church run hospitals, health centres and schools, and assisting the PNG Government rebuild the failed health system ought to be Australian-funded priorities. By restructuring our aid program, and bringing in church and business partners, that can comfortably be financed.

But real and sustained economic development, and lifting living standards and opportunity for young people, requires two major steps, and it requires them to be funded well beyond our aid commitments.

The first initiative is one I have long championed. Papua New Guinea has woefully inadequate and unaffordable electricity supply for homes, businesses and industries. It has been estimated that barely 15 per cent of the 9 million population have access to affordable and reliable electricity.

Australia is committed to funding a solar power project. Even if it goes ahead it will make little impact. China recently inked a deal with the nation's state owned energy corporation for a hydro power project (Ramu2) which won't make a substantial impact and deliver power and even what it delivers will be very costly and uneconomic even for industry, let alone domestic consumers.

The only way to deliver affordable and reliable electricity to the majority of Papua New Guineans, and industry and business, is through the development of the Purari hydro power project in the Gulf Province. I have written here and elsewhere that it is expensive, but it is the only clear way to deliver affordable and reliable electricity across Papua New Guinea.

A decade or so ago the Australian energy sector was interested in the project on the basis that it could provide clean and green, and very cheap, electricity to Northern Australia. Sadly a lack of Australian and Queensland Government interest saw the proposal proceed no further than an initial study.

It will cost in the region of $6 billion, but it can be developed in stages. To that cost needs to be added the cost of delivery of generated electricity to Port Moresby, other major centres, and eventually rural communities. So it is not cheap, but if Australia, and other democracies in our region, want to help PNG achieve its goal of affordable reliable electricity it just has to happen!

The high cost and unreliability of electricity in PNG today is holding back economic development, and rising living standards. The answer can only be a major electricity generation project big enough to lift availability of power to the stated goal of m80 per cent of the population by 2030.

Australia, through the Snowy Mountains Power Authority and any number of state and private energy companies, has the technical and other capacity to deliver Purari in a reasonable time frame. Japan has the right experience as well as does the United States and New Zealand.

And the funding can be delivered under the Biden G7 initiative with a mix of public and private sector capital.

If Purari is built in a staged way it can eventually power the whole of PNG, and lead to the establishment of something PNG desperately needs – downstream processing industries.