| Business |
SHP yearns for peace and growth
At least since the mid-1990s, the law
and order situation in the Southern Highlands has left much to be
desired, culminating in the 2002 national elections fiasco when
elections in the province had to be abandoned.
From that perspective, one is entitled to question whether the oil
wealth of the SHP has, in fact, been a curse somewhat akin to the
‘Dutch disease’ that economists believe sudden resources wealth
generates in many third world countries.
In the first decade of oil production, from 1992 to 2002, the
Kutubu oilfield paid the National Government K2.6 billion in
corporate taxes and local landowners, either directly or through
the Mineral Resources Development Corporation (MRDC), received
K170 million in royalties.
Since the first full year of oil production in 1993, output has
dropped by close to 70% but the recent upsurge in oil prices has
meant that revenues, taxes and royalties are higher than ever
before. This will drop dramatically if ExxonMobil and Oil Search
are unable to bring on stream their proposed LNG plant in 2013,
when a significant share of royalties will go to a new group of
landowners at Hides.
Nevertheless after almost 15 years of law and order problems and
virtual economic stagnation, there have been renewed hopes of
recovery and better days.
The aspirations of the common SHP people were captured by The
National’s Peter Korugl in an election-related article he wrote in
the paper’s Weekender on July 20. Travelling to various parts of
the province, Korugl was constantly told of the people’s yearning
for peace and their optimism that things were about to change.
“I believe things will be okay after this election. I am confident
we will find a good leader,” he quoted an elderly mother as saying
at Yuwanda community school, as she prepared to cast her vote.
Tribes that had been split by serious internal conflicts were
coming out, reportedly for the first time, to cast their votes in
a common determination to see an end to unnecessary killing and
wanton destruction of valuable property.
Although this has not been publicly stated, it is likely that some
of this optimism has grown from the National Government’s recent
intervention in SHP through declaration of a state of emergency.
This has enabled most people to savour what normal living is like
after years of living on the edge.
Prior to the election, there were widespread fears about the high
levels of weaponry among people in the Highlands region, and the
peaceful manner in which elections have been conducted in SHP is a
promising sign for the future.
With the huge amount of revenue flowing into government coffers
from the SHP oilfields, the National Government has a heavy
responsibility to improve its level of service delivery in the
nation’s most populous province.
Already governor-elect Anderson Agiru has promised an end to the
cash handout mentality of the past so that available funds are
better utilised for development purposes, although he will
certainly have to work hard to appease people who are unhappy with
election outcome to ensure they do not contribute to a
deterioration in the law and order situation.
The issue of compensation payments also needs to be tackled head
on. It is certainly right when private sector developments such as
new mines, oilfields or pipelines are built that people are
compensated for destruction or loss of property rights.
However, this should not be the case when public amenities such as
roads, schools and hospitals are built because such infrastructure
are designed to help communities that live in these areas and to
help lift their living standards.
To some extent, this intolerable situation has developed, which
add to the costs of individual projects, because of a history of
underdevelopment. Desperate people, who live subsistence
lifestyles, seek out any avenue to obtain cash. This kind of
situation has to end, bringing benefits to larger sections of the
overall community.
An enlightened governor can do much to lift standards of service
delivery and especially to ensure that public servants continue to
provide services they have been hired for in provincial capitals,
rural towns and elsewhere in the running of public utilities,
schools and hospitals. This is true of Southern Highlands as well
as any other province in the country.
 
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