Papua New Guinea prepares for its most consequential elections since independence

While the focus in the Australian community is naturally on the federal election now certain to be held between March and May 2022, it is really important that the national government and all those interested in the future of our closest neighbour do not ignore the Papua New Guinea national elections, which will be held around the same time.

In the coming months I will write a series of articles on the elections which, although democratic, bear little similarity to Australia's federal and state elections.

As background, I invite readers to look at the devpolicyblog that has been running a series on the PNG elections, particularly posts by Terence Wood, with input from a couple of PNG academics.

He has comprehensively outlined the history of recent PNG national elections, held every five years. The troubles he highlights are too many to comment on here, but they include serious flaws in the registration of voters on the electoral rolls, lawlessness during campaigns and voting – which extends over several weeks – and allegations of corrupt practices by polling officials.

I will cover the electoral process in a future piece, and offer some suggestions on how Australia might carefully, but constructively, help ensure "free and fair elections" in our closest neighbour.

Reviewing events in the robust and changing world of PNG politics over the last year or two I have come to the conclusion that the 2022 PNG national elections will be the most "consequential" since Independence.

I have observed every PNG elections since 1982, some at very close hand. The one real distinction between our elections and PNG's is that, while ours are based on political parties and policies, Papua New Guinea's are very much "local", determined on a seat-by seat basis across the nation.

It has been difficult to predict who will win, and lose, due to factors that centre on seat by seat results and of course how much candidates (and to a lesser extent political parties) spend.

Even after all votes have been counted and the more than 100 seats declared (and that takes weeks) the next government is not known until Parliament meets. Even then, recent changes to the Constitution have complicated the process. Often who will be elected Prime Minister is not known until the actual meeting of the National Parliament for the first time…usually about four weeks after the last seats have been declared.

I will cover the vagaries of that period closer to the election.

When I last checked there were about 25 political parties "registered" with the PNG Electoral Commission and the Registrar of Political Parties. There are at least another 20 either seeking registration, or campaigning already without being registered.

Added to the huge number of candidates representing political parties are the extraordinary number of candidates who nominate in open and regional electorates. There are 111 electorates overall (22 are regional seats). In 2017 there were 3,332 candidate – that is, an average of over 30 candidates per electorate.

In that election the then Prime Minister Peter O'Neill led the PNC Party, securing 28 seats with 13.5% of the total vote. Second was the National Alliance Party, with just over 6% and 15 seats. No fewer than 19 parties secured at least one seat.

Why will the 2022 elections will be the most consequential in PNGs short history as a nation?

Since his election as Prime Minister in 2018, James Marape has been seeking to carve out a political agenda on the broad "Take Back Papua New Guinea" theme. In essence, it means that Marape wishes to reduce the level of foreign ownership in PNG – especially in the resources sector.

The first result was the closure of the profitable Porgera gold and copper mine as a result of the government's determination to increase its "equity" in the project. Landowner unrest added to the forced closure. The mine remains closed despite extensive negotiations between the Marape Government, the provincial government, landowners, and the majority owners Barrack Mining (which has a minority PRC partner).

It was recently estimated that re-opening the mine (now scheduled for April next year) will cost over K1 million (1 kina = .28 USD). A very expensive result of "Take Back PNG", not to mention the hundreds of millions lost in revenue since the mine closed.

The "Take Back PNG" strategy has extended to every proposed oil and gas and mining project, with the national government vigorously negotiating greater equity in all projects. The strategy is one reason why the potentially very rich Wafi Mine in Morobe Province – majority owned by Newcrest – is being delayed for an indeterminate period….at a time when PNG desperately needs the investment, revenue, and jobs it would create.

In recent weeks the "Take Back PNG" agenda has taken on two quite different and significant (and worrying) aspects.

Firstly, the national government signed an exclusive agreement with a foreign owned company (with Australian links) to process all of PNG's gold production. At present gold producers make their own arrangements, as they have done for generations, with the state benefiting from taxes and other charges.

There is limited processing in PNG, and while the "value adding" principle is not without justification in a number of areas (such as fisheries, timber and some mining) the effective "nationalisation" of gold processing has rocked the confidence of the mining sector.

Secondly, last week the Minister for Agriculture, without industry consultation, announced plans for a "central export agency" for the nation's agricultural production – notably coffee and cocoa.

Ominously, he said one reason why PNG needed a central export agency (controlled by the state) was that "China wanted 20,000 tonnes of PNG coffee, but he could not give it to them because the nation's 50,000 tonnes of annual exports was managed by private sector exporters.

As a seasoned coffee industry expert reminded me, China won't be interested in paying the world prices PNG currently receives for its coffee and cocoa exports.

These are just a few example of what "Take Back PNG" means in reality. It's a form of economic nationalism with obvious "socialist – big government" implications. At a time when PNG continues to run up huge annual budget deficits, "Take Back PNB" is and will increasingly be a costly impost on the fiscal position.

Papua New Guineans are overwhelmingly pro-business and free enterprise. They are rightly suspicious of too much government, especially too much government intervention in business and industry. Socialist parties have never done well in Papua New Guinea for these reasons.

When you look at the record of state-owned corporations in PNG, who would blame them???

The state-run electricity generation and distribution system is inefficient and costly, with blackouts a daily occurrence in many centres, Most state owned enterprises are in terrible shape, and the basic services provided by the government – health, education, roads etc – have never been worse than they are today.

It will be interesting to see if any PNG leaders, notably Peter O'Neill and Opposition Leader Belden Namah, run campaigns that challenge the "practicality and reality" of "Take Back PNG". Former prime ministers, Sir Julius Chan and Paias Wingti, as well as other party leaders, may do so as well.

If so, PNG might just for the first time have a real policy contest – between a big state, interventionist government that limits the ability to fund basic services and one that offers a real alternative of small business growth, improved basic service delivery and reduced state debt.

There is unquestionably an "attraction" in what Marape has been outlining – but in practical terms Papua New Guinea is in a very weak fiscal position, and a worrying economic state given the Covid-19 pandemic and vaccination rates at barely 3%.

The challenge his opponents face is to articulate a message that does not dismiss "Take Back PNG", but looks at it in a practical "real life" way. And to offer an alternative based on improving the living standards of the 9 million people of PNG who frankly have suffered for too long from poor and poorly focussed government.