Alternate PM: Allan Bird on inflation

Alternate PM: Governor Allan Bird

By Allan Bird

Why is the Kina depreciating so rapidly?

PM Marape in his response to the concerns raised by our ordinary people affected by rising cost of living due to the effects of the depreciating Kina and inflation leaves much to be desired.

The biggest contributor to inflation and the depreciation of the Kina in the last 5 years is the fiscal behaviour of the national government.

We have been boasting about consecutive record government budgets and we never speak of undisciplined Government expenditure funded from printing money. If a record budget does not strengthen the economy then its size does not matter.

By increasing the money supply within the local economy without the backing of a strong economy the Government has essentially oversupplied Kina thereby rendering it worthless. This is the net effect of printing money. Printing money only works in large diverse economies. Our economy is too resources reliant and susceptible to external shocks.

Whats happening is that all costs are going up and government is unwilling or unable to increase wages to off set inflation. Inflation is running at around 5% a year, so adjusting wages upwards every year is unsustainable without a corresponding increase in productivity. Also giving free handouts to the people is not a smart longterm solution.

Meanwhile, the Central Bank is struggling to control the rapid decline in the value of the Kina so that it can contain runaway inflation.

The PM is telling everyone that we have to wait for the big mining and oil and gas extraction to commence operating inorder for the people to get some relief. Are we back to short term pain for long term gain again?

If we had cut back government spending on wasteful projects by an additional billion kina a year, that would have meant K5b less in printed money.

If we had allowed Porgera to operate, that would have meant an additional $6b in FX we would not have had to borrow. Not to mention it’s multiplier effect on other businesses. That’s what the PNG economy is experiencing.

Unfortunately our Government has borrowed K32 billion in 5 years. This number equals all borrowings by all Governments since 1975. Our total official debt is K64 billion and half of that was borrowed in the last 5 years.

PMJM tells us GDP grew by K30b since he took office. Well debt grew by K32b in the same period. This does not include other debts currently sitting off the books.

The fix is simple but it will require strong political will to do it. We must first live within our means. Stop looking for ways to borrow money to fund all kinds of low return initiatives Good government is about spending for the collective interest, not on narrow political interests.

Second, we must rescind the decision to create elite capture mechanisms like KPHL. Bring in the Sovereign Wealth Structure and start putting real money into it and keep it in the Central Bank to provide stability and back stopping for the Kina. Whats the point of boasting about K12b in FX Reserves when your total debt is K64 billion and half of that is foreign denominated loans?

Given our lack of economic diversification, we are susceptible to external shocks and this can significantly affect the currency flows into our economy.

We must manage our economy with prudence and not expect some windfall revenue in the future to rescue us. This practice of gambing on future revenue by borrowing and expending today on projects with dubious returns is exactly why we are in trouble now.

PNG needs to tighten its expenditure and exercise fiscal restraint. We need leaders who understand the problem and have the courage to deal with it.

Our people cannot absorb any more pain. It seems only the cocoa growers are exempt from the struggle for now but every other PNGan is feeling the pinch.

Belen Namah calls for apology from Biden

NAMAH CONDEMNS UTTERANCES BY USA PRESIDENT JOE BIDEN

Press Statement
3rd April, 2024

The Chairman of Parliament Committee on Foreign Affairs, International Trade, Immigration & Defence and Member for Vanimo Green River Electorate, Hon. Belden Norman Namah has condemned utterances by the United States President Joe Biden describing a situation in WWII where his uncle was shot down and eaten by cannibals in New Guinea.

First of all, there is no such country called New Guinea in the Pacific.

But if President Biden was referring to Papua New Guinea, Mr. Namah said “President Biden’s utterances are unfounded, unacceptable and utterly disrespectful to the Independent State of Papua New Guinea and her people. The truth about the fate of his uncle Ambrose has never been established and President Biden knows that. Yet he chose to reverberate the mystery with cannibalism. This is no slip of the tongue.”

For Prime Minister Marape to say it may have been a slip of the tongue is not only an understatement but also an irresponsible statement unbecoming of the Head of the Government of Papua New Guinea.

Clearly, Marape failed to condemn the despicable words from President Joe Biden. He instead chose to speak for Biden saying it may have been a slip of the tongue. “Speak for yourself and your Country, Prime Minister”, said Mr. Namah.

Mr. Namah further added that Marape’s calls for USA to help clear its WWII mess is a kneejerk reaction and shows that he is not aware of the “Render Safe Programme” that has been ongoing in the Country to rid our communities of unexploded WWII ordinances.

Mr. Namah said “there’s a lot to be desired from the conduct of James Marape as the Chief State Diplomat. Its even laughable “wheezy whassy diplomacy” to say the worst. Recently he came to the defence of his Foreign Minister who apparently labeled Papua New Guineans as primitive animals”.

“Stand up for your Country and People, Prime Minister, and defend Papua New Guinea at all cost without fear or favor,” said Mr. Namah.

………………………………………………
Hon. Belden Norman Namah, MP
Member for Vanimo Green River Open Electorate &
Chairman of Parliament Committee on Foreign Affairs, International Trade, Immigration & Defence

US Embassy in Port Moresby hasn’t apologised to PNG

Media Statement – US Embassy in PNG

Following US President Joe Biden’s claims that his uncle Bosie was eaten by cannibals in PNG, the U.S. Embassy – Port Moresby, Papua New Guinea issued a statement without an apology. Thousands in PNG have taken it to the social media calling for an apology, it’s looks like there won’t be any, and here’s why:


The Embassy only says what the US president and White House say. Joe Biden referred to cannibalism twice at two different places last week. Neither Biden nor the White House have retracted the claims of Biden’s uncle eaten by cannibals.


Basically, Biden doesn’t want to apologise, the US Embassy in PNG therefore cannot apologise.


Why cannot Joe Biden apologise?


There are two possible reasons:


First, Joe Biden truly believes that whatever stories his parents told him as a kid, and doesn’t want to let go. However untrue and stupid that makes him look.


Second, US presidential elections is this year. To apologise would be admitting he was wrong. Trump would tear him apart.


What does this mean for US-PNG relations?


As the PNG prime minister has shown, American money is too good to take a firm stance and demand an apology. PNG prime minister said it may have been a slip up on Biden’s part even though Biden “slipped” up twice.

It’s very clear on social media that Papua New Guineans want an apology. The impact on majority of Papua New Guineans is that Papua New Guineans will see the US as ignorant and arrogant partner.


Meantime China sings a deal that allows PNG cocoa and coffee to be exported to China. Cocoa and coffee farming in PNG is dominated by smallholders – families and households in rural areas. Millions of people will have cash from their exports. In the same week US president calls PNG land full of cannibals, China offers market access.


It doesn’t take a rocket scientist to know which country is been seen as respectful to Papua New Guineans now.


An apology from the US Embassy in PNG is will go a long way in societal buy in to the PNG-US relationship. The embassy should advise US president to offer an apology.

KEEPING OUR POLLIES HONEST

PC: Dr Joseph Ketan

By Joseph Ketan

It is hard to keep track of politicians. We cannot hold them accountable for their actions if we do not know what they are doing – or not doing – with respect to their duties.

We have got to keep our politicians honest by keeping an eye on them at all times!

The PNG daily newspapers, generally, do a good job in keeping our parliamentarians honest, although in recent years there has been growing concerns over biassed reporting on several occasions.

Radio still does a terrific job in terms of coverage and the quality of reporting. The NBC easily leads in keeping our people informed on what is happening in our country. The commercial FM radios are doing a good job, but their focus is on the national capital, leaving room for improvement.

EMTV could become a powerful medium of communication, but they employ lazy reporters, with terrible English, while the good ones (John Eggins and Scott Waide have moved on).

Social media, with all its faults and awful grammar, has the potential to hold MPs accountable, though we get a lot of misinformation at the moment. The level of literacy will improve the standard of reporting and debate on key issues affecting our country.

Sir Anthony Siaguru used to provide some great commentaries on the state of affairs in PNG. I enjoyed reading Dr Tony Deklin’s commentaries, but he has stopped writing for the general public. I love reading Dr Andrew Moutu’s elegant articles on a wide range of topics, but his writing is not for public consumption. He writes for a cultured audience.

John Endomonga and Samson Komati provide useful political commentaries on everything political. Their commentaries, although biased, are necessary. David Lepi’s commentaries are biased toward Peter O’Neill – but he writes beautifully.

Micheal Kabuni and Duncan Gabi do better than most. They will, no doubt, take the mantle of responsible reporting in years to come. I hope politicians do not buy them off. Patrick Kaiku and Teddy Winn will provide leadership in political analysis at UPNG soon. Francis Wagiriai and Mike Kabuni will join them there. That will provide the basis for PNG political scholarship and commentaries on national affairs.

I would love to read more from some great thinkers, including Roland Katak, Joseph Sukwianomb, Professor John Nonggorr, Dr Thomas Webster, Gabriel Pepson, Peter Pena, Peter Komon, Paul Mawa, Paraka Maua Pena, Thomas Laka, Dr Lawrence Sause, Dr Steven Winduo, Dr Elizabeth Kopel, Dr Fiona Hukula, Dr Orovu Sepoe, Dr Hengene Payani, Dr Linus Digim’Rina, and Professor Frank Griffin, and my countrymen Frank Senge Kolma and Nikints Tiptip.

We live in a country with high levels of illiteracy at all levels. It is up to people with knowledge of government to comment on public affairs.

When good men – and great women – stand by and do nothing, evil triumphs. So, it is absolutely necessary that learned men and women must stand up for the rights of the downtrodden.

Have a Safe Easter!

Disappointing disaster responses in PNG

Disappointing disaster responses in PNG

PNG’s history for disaster response is fraught with delays, inefficiency, and corruption. Here are some blunders we experience during disasters:

  1. Corruption

Under the Public Finance Management Act, the tender process is suspended when a disaster is declared. This is done to ensure the response is not delayed by the bureaucracy of tender processes.

The government doesn’t have to go through the tender process. Instead it gives the funds to a specific service provider so they can move with speed to get supplies and life saving equipment to the people. This may include, for instance, brining water purifiers from overseas, or logistics for medicine, or building a damaged telecommunications equipment to re-establish communications etc.

The problem is that politicians and authorities then give the contracts to their cronies and wantoks who have no experience, or capabilities to deliver. As they delay and misuse and mismanage the funds, the people suffer.

  1. History of unaccountability

To date, we have no audits for the millions spent on the devastating earthquake in the Highlands in 2018. Parliament has never received a report to that effect. No one bothers. And life just moves on.

It’s the same for most of the K6 billion spent on COVID-19. Now the IMF is demanding acquittals.

  1. No budgets for disasters

PNG is prone to disaster. Every year there’s flooding somewhere that destroys homes and villages and gardens, or there is a volcanic eruption, or drought, or high tides, or cyclones etc etc.

Yet when you look at the budgets for departments responsible for disasters it’s almost negligent. Our national policy for disaster response is called “ad hoc” strategy.

  1. Lack of coordination

For every review, you will hear about the lack of coordination. This problem applies to donors and aid providers as well.

When there is a disaster, the private sector gives some assistance, the foreign embassies give something, the international NGOs, the multilateral organisations, provincial and national governments, all respond at various levels.

A national, streamlined, and predictable strategy would help. But usually, different stakeholders do different things or fund the same area whilst others suffer.

  1. Lack of data

This is the most important one: do we know exactly how many people live within the area affected by the floods and volcanic in East Sepik Province?

Do we know how many women, men, children, those with disabilities, the number of houses, etc.

This is important so we know exactly how much to budget, what kinds of essentials to buy, and where to deliver.

Our last proper census was done in 2001. In 2011 we tried another census which was so inaccurate that even the census office – National Statistics Office – admitted to its inaccuracies.

The next census is planned for 2024, about 23 years later. Someone born in 2002 was never been counted and PNG has no record of his existence. So when disaster hits, you don’t know if this kid even exists, where he exists, or whether is disabled.

We just allocated K10 million because that’s what we think is needed.

Exceptions:

I know there are some very hard working people working day and night to get the stuff our people need. And some good leaders like Allan Bird who saved money from Provincial Services Improvements Program funds and now using it to respond to the disaster. There are some beautiful souls in guys like MAF who assist during disasters. Thank you all.

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