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Aust dominance cut by import surge from US and Singapore PNG’s trading pattern has been undergoing substantial change in recent years.Nearly everyone is aware of the surge in export earnings that have taken place because of booming resource prices. In the five years from 2002 to 2006, total PNG exports have more than doubled to K12.7 billion with big increases from copper, gold and crude oil. Resource exports in this period has risen faster than the overall export figures, going up from K4.8 billion in 2002 to K10.5 billion in 2006. There has also been a significant increase in agricultural export earnings despite a fall of almost K300 million in revenues between 2005 and 2006. These have risen from just over K1 billion to a record K1.95 billion in 2005, before dropping back to K1.65 billion in 2006. There has also been some slow but steady growth in forestry exports, which rose from K414 million in 2002 to K527 million in 2006. Marine exports provided a more erratic picture, going from K94.1 million in 2002 to a record K125.3 million the following year and plunging to K58.2 million in 2004. Rises in the two subsequent years took it to K92.2 million in 2006. Exports are dominated by sales to Australia, which is a major importer of crude oil and gold from PNG. Exports to Australia have almost doubled from K2.7 billion in 2002 to K5.2 billion in 2006. Japan, the second largest market for commodities from PNG, rose from just over K1 billion in 2002 and K1.15 billion in 2005 to K1.8 billion in 2006. After these two major markets, PNG’s third largest customer, China, only purchased a mere K467 million worth of goods in 2006, compared with K277 million in 2002 and a record K522 million in 2003. The picture on export growth is a reflection of the poor level of diversity within the PNG economy and the large dependence on the resources sector. Dynamic import scenario The import scenario, however, appears much more dynamic and interesting. Australia’s role as the dominant supplier of manufactured goods and other imports has been fairly stagnant during this five-year period, possibly as a result of the negative attitude of the former Howard Government towards Papua New Guinea. Australian imports into PNG went from K2.47 billion in 2002 to a record K2.59 billion two years later and have since fallen away to just over K2 billion in 2006. The United States has been the biggest beneficiary of the steadily growing market for foreign imports. It had long been the second most important provider of goods for this country with imports in 2002 valued at K364 million. This has grown almost four-fold in the intervening period to K1.27 billion in 2006 and almost doubled in the year since 2005 (K650 million). As a clear sign of growing Asian influence, the third largest exporter of goods to PNG is the tiny island republic of Singapore, though some items coming from there could be also sourced from Malaysia, Indonesia and other countries due to Singapore’s role as a global shipping centre. In 2006, PNG imports from Singapore had rocketed to K1.16 billion from just below K300 million the previous year and K238 million in 2002. Japan, the next biggest exporter to PNG, has seen its share rise to a record K303 million in 2006 from just around K200 million over the previous five years. The Aussie factor Australia’s continuing success in capturing about one third of PNG’s market for foreign goods – the trade balance in 2006 was in PNG’s favour to the tune of over K3 billion – has been largely due to traditional ties between the two countries. Despite the negative stance of the former Australian government of John Howard, the Australian government’s trade promotion agency, Austrade, has made it clear at various conferences that PNG is a natural first stop export destination for many Australian companies. Despite the poor PNG image widely portrayed by Australia’s mass media, Austrade says that Australian companies sell a wider range of goods and services to PNG than to any other country. Some 3,000 Australian companies export goods and services to PNG. This is a level of activity that is unmatched by Australian exporters in other parts of the world even though PNG, as a relatively small economy, is only Australia’s 21st largest trading partner. It may appear somewhat ironic but the biggest item flowing in both directions is crude oil. In the year to June 2007, crude oil and condensate from Australia’s North West Shelf region in Western Australia exported to InterOil’s Napa Napa refinery in Port Moresby was worth K1.1 billion. Austrade figures show that in this period crude oil exports from Kutubu, Gobe and Moran fields operated by Oil Search to Australia was worth K2.7 billion with PNG’s gold exports to Australia worth an additional K2.5 billion. According to Austrade, Australian exports to PNG drops off dramatically after crude oil with the second largest item being civil engineering equipment worth K125 million, followed by specialised machinery (K110 million), transport vehicles (K87 million) and coffee and substitutes (K78 million). With such small amounts of exports involved, one can understand why there are 3,000 Australian exporters involved. According to Austrade’s reckoning, Australian exports to PNG in the year to June 2007 were worth K3.7 billion, a figure that includes exports of services as well. With Australia’s new Labor prime minister Kevin Rudd about to reactivate the annual bilateral Ministerial level meetings and his own official visit in early March – the first to any country – it is more than likely we are about to see Australia reasserting its dominance in two-way bilateral trade.
Old age, a burden for today: Study By MARLOWE HOOD PARIS: Policymakers fretting over the costs of caring for the aged will face their greatest challenge in the next two decades, although the burden should ease towards the end of the century. So says a study which suggests that the much-feared crisis of ageing of the world’s population is already starting to bite, as the post-World War II Baby Boomers shuffle into retirement, inflicting a heavy hit on budgets in developed countries. The percentage of greyheads in the world’s population will increase rapidly over the next 20 years, although this acceleration will peak in different regions at different times. Japan is already nearing the period when the proportion of ageing people in its population is starting to quickly surge. North America, Europe, China and the countries of the former Soviet Union will follow sometime between 2020 and 2030, according to the paper, published recently by the British journal Nature. South Asia will go through a decade of rapid ageing beginning in 2035, the Middle East in 2040, and sub-Saharan Africa at mid-century. “It is really important for policymakers to take these figures into account,” one of the authors, Warren Sanderson of the State University of New York at Stony Brook, said. Most demographic projections fail to acknowledge nuances about how quickly a population ages, but the implications are far-reaching for healthcare, where costs rise dramatically towards the end of life, he said. At present, 10% of the world’s population is over 60; this will slowly rise to 13% by 2020 but leap to 17% by 2030. After that, it will continue to climb gradually to 32% by 2100. In China, the increase will quadruple, from 10% today to 42% by 2100, whereas nearly half the population in Western Europe – 46% – will be over 60 by century’s end, compared with 20% today, according to the study. By these yardsticks, future generations would appear to be doomed to carrying a huge social burden. “People look at those numbers and they get very scared, thinking that their healthcare expenditures are going to explode,” Sanderson said. But, he said, the biggest challenge will fall before 2030 for developed countries and by 2050 elsewhere, because so many people will age so quickly in the coming years. Paradoxically, the health-cost crisis could be relatively easier to manage in the decades after that. Despite the larger proportion of elderly, many of the over 60s in the latter half of this century are likely to be hale and hearty and will not need to go to the doctor. Medical care becomes most expensive in the last few years of life, and not before. Some studies have calculated that someone who is 65 in 2100 can expect to live beyond 90. “There are two ways to look at age: one is how many birthdays you have already had, and the other is how many you expect to have in the future,” Sanderson explained. Instead of looking at the percentage of people aged over 60 – today’s typical benchmark for old age – we should look at the percentage of people whose life expectancy is 15 years or less. By 2100, nearly a third will be aged over 16, but only 16% will be in this final, costly stage. “Looked at this way, the figures are rather reassuring,” he said. – AFP |
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