LEADERS past and present, including Prime Minister Sir Michael Somare, are right in saying that Papua New Guineans must have a stake in their own economy. Politicians have been saying this for the past 35 years.
Papua New Guineans must be given the business opportunities and preference must be accorded to local business.
The leaders are also right in arguing that locals must have a share in corporate PNG. Partnership or joint ventures are good arrangements and, handled properly, the benefits accruing cover more than just the matter of ownership.
But, what must be given careful thought right now is the continuous call for legislative review of laws governing foreign investments.
Many have argued that all businesses owned by permanent foreign residents must be restructured to include local equity.
The question is whether legislation is the solution.
Whatever the experiences elsewhere, and given PNG’s own special circumstances, it may well be the answer 35 years after independence.
Indeed, an investment code was drafted into the Constitutional Planning Committee recommendation along with a leadership code. Yet, the then government threw out the investment code as being too unwieldy and complicated to manage, opting instead to keep the leadership code.
Perhaps, after 35 years of experience, it might be time to revisit the investment code.
If this is indeed so, it must be undertaken as part of a clear, consistent and carefully thought out national policy. It must be broad to see the nation’s economic direction over the next decades.
This is because any policy on investments – be it business, industry or property – has wide ranging effects. While many leaders speak of restructuring through a simple “first right of refusal” approach, the implementation will be fraught with misunderstanding and grievances. Utmost care is, therefore, in order, if this is the accepted route, to assure investors that there will be no expropriation of assets.
The one thing that businesses have no answer to nor protection against is nationalisation, and a mere hint of that will cause an exodus. It is, therefore, no surprise that no country with a nationalisation policy has been successful.
Still, it is an idea that will need to be discussed and debated. There is a very real situation developing where Papua New Guineans might be second-class citizens and bystanders in their own country while all business and property rests in the hands of foreigners. That would provide an explosive climate for strife and tension in future.
The anti-Asian riots of May last year provide a stark reminder of the tensions and frustrations that are increasingly coming to the fore.
Added to that, there has been much patronising by the developed western nations. They assume Papua New Guineans were living in a state of ignorance about their history, tradition and capabilities until the “civilised” Europeans came. Its beggars belief that this feeling of self-inflated importance still persists among developed nations, their donor agencies and NGOs about the perceived lack of intelligence of the people who live in countries like PNG who, at some time in the past, had superior, sophisticated civilisations complete with socio-economic, political and welfare systems that catered for their every need.
Why not just respect each other as equal and grow beyond this idiotic insistence of assuming that all people, who occupy anywhere beyond the realms of the West, should drop to their knees and be thankful for what the western civilisation has done to advance them economically. Rather, the West should grow to appreciate the contributions that the rest of the world has given to them.
In the final analysis, what kind of economic system do we want in PNG? What are the priorities and objectives? Is it growth? Is it distribution? Or job creation, export competitiveness, import substitution, technological progress?
We do not need to go far to find the answers. They were there right from independence. The National Goals and Directive Principles enshrine in the constitution are what this nation of many tribes aspires to.
What needs to be developed now is to develop policies, strategies and programmes that will help to frame overall economic policy, which includes ownership and participation. Only then will the goals of the constitution be realised.