More than a K10b dream

Seed banks, R&D are crucial for PNG’s agricultural aspirations

By CYRIL GARE
IN his 47th Independence anniversary message Prime Minister James Marape envisages to raise K10 billion “easy money” for the national coffers if one million rural families were engaged in toiling the soil and earning K10,000 each annually from agriculture – a sector he termed as the sleeping giant that must be awakened now and not tomorrow.
There is more confidence in the sector following his large coalition government’s creation of three additional ministries of oil palm, coffee, and livestock, and boasting of an ambitious price support subsidy scheme to achieve this end.
FDI contrast
On the contrary though, he invites commercial developers through foreign direct investment (FDI) in production of cocoa, coffee, oil palm, poultry and livestock that in the long run will compromise growth of indigenous MSME and SME businesses who may also have interests in these areas of business.
Take for example, the Huaripmo commercial chicken project in Yangoru in East Sepik, operated by the Israeli Agro-Industries Limited. Israelis are doing similar agricultural projects in NCD, Central, Enga and Southern Highlands. Landowner farmers play by the rules of the State-sanctioned investor and settle for a small reward in the value chain.
The PM is now talking about the “reserved list” and capable PNG-owned companies to operate logging, mining, fisheries, supermarkets and wholesaling, trucking, plantation scale agriculture, etc.
He also fell short in outlining funding support for capable PNG businesses to grow using home-grown development models instead of continuous mention and reliance on the alien FDI concept which must be made redundant by now.
Where resource projects are located, foreign investors have done so much irreparable destruction to our environment, creating chaos and disunity among clans and tribes, and destroying social structures.
All governments since Independence fell for the love of profit rather than the health of society. We have become more ‘westernised’ than we have become ‘modernised’. Our physical quality of life (PQL) indexes remain one of the lowest in comparison. FDI needs review now rather than later.
The development formula; Land + Labour + Capital = Production needs a post-mortem. Land must remain customary owned and under no circumstance be usurped by the State and alienated. Skilled labour is what’s needed to drive ‘mechanised agriculture’ at rural level where land is.
We are not even close to applications of simple appropriate machines in rural agriculture production as yet, compared to Philippines and other Asian countries. Capital funding must be state-guaranteed. We have done this under the Personal Property Security Act 2011 – a law which came into full effect in 2016.
In June, 2019, Blasius Vovore who represented his Vunamami Cocoa Cooperative of East New Britain became the first person in PNG since Independence to receive a cheque of K1,000 from MiBank – a newly established commercial bank subsidiary of the National Development Bank (NDB) during a ceremony at Vunamami. I was there and covered the story.
A simple rural cocoa farmer can now get a commercial bank loan using his cocoa block as collateral or security. Thanks to the new law – the Personal Property Security Act 2011.
This was a revolutionary partnership forged between the Cocoa Board of PNG (CBPNG), the PNG Agriculture Company (PNGAC) (a subsidiary of the CBPNG) and the MiBank with technical assistance and continuous support from the Asian Development Bank (ADB) since 2002.
The three parties created a product – the agriculture value chain (AVC) loan scheme which now enables simple rural cocoa farmers to access commercial bank loans to help them improve their smallholder cocoa blocks and run it as a business sustainably into the future.
Should a farmer wish to acquire an AVC loan, s/he must first become a registered member of the PNGAC, have an existing bank account with MiBank, allow PNGAC to inspect and collate relevant information on his or her cocoa block and thereby compile report and recommendations to MiBank, has a 20 per cent equity, and be able to repay loan at 2 per cent monthly.
Since Independence, citizens who do not own “stationary assets and properties” such as land or houses found it difficult to obtain bank loans resulting in the economy being stagnant.
In 1995, the Mekere Government introduced the financial sector reforms which saw amendments to the Central Bank Act, creating an upsurge of financial intermediaries including super funds, financial institutions, savings and loan societies, and more commercial banks, among others which enable the economy to resuscitate – based on the principle that “money is created when money is lent”.
Research and development
The Prime Minister did not mention funding support for research and development (R&D). He did not highlight the reasons why a Science, Research and Technology Secretariat was created and what have they done so far for nation building.
Malaysians dominate our oil palm and logging industries. Israelis dominate commercial agriculture. British continue to dominate our shipping industry. Australia eyes our gold as always and even today are eying processing gold bullions in PNG with State sanction while Americans remain quiet in the background sucking from our petroleum, oil and gas fields. Simply put, it is our resources but their profits. This is the trend 47 years on.
What trajectory for change is he talking about?
With R&D new innovative cash crop varieties like massoy, patchouli, tuberose, vetiver and other such plants with essential oils value can be introduced as additional income means for rural farmers.
Essential oils with uses in perfumery, food, pharmaceutical and medicinal spheres command around US$26 billion in world trade annually.
University of PNG School of Natural and Physical Sciences is currently piloting these innovations at its Mekeo research facility (hydro distillation plant) in Central province through a PIP government funding.
It is an opportunity for this government to continue funding it to full commercialisation and export during this term and place PNG on the pathway to the US$26 billion essential oils treasure chest.
The socio-economic benefits from a full-scale essential oil industry in PNG would be huge with millions of our rural farmers expanding their income bases and improve PQL.
Furthermore, our biodiversity hosts thousands of plant and animal species which only through research that discoveries like hopeaphenol can be found.
Hopeaphenol is a chemical compound found in a PNG plant which through research was collected by Prof Topul Rali and submitted to Australia’s Griffith University in 1996 which today appears as a top candidate for treatment against Covid-19 and HIV.
Papua New Guinea is destined to become the world’s hub of hopeaphenol commercial production if pharmaceutical giants like Astra Zeneca decides to create a vaccine out of it (a part from its current vaccine).
Seed banks
Seed propagation or seed banks is missing and if there is any in the country currently, it’s too costly for rural farmers to obtain cheap quality seeds and planting materials.
For animals, there is no hatchery or breeding nurseries for young animals to supply to rural farmers.
Agriculture starts with seeds. No seeds, no agriculture. It is the same for animal husbandry. There is no mention of the Forest Research Institute (FRI) in Lae whether this Government has plans for it to propagate seeds for the country’s agricultural needs. There is no mention of the National Agriculture Research Institute (Nari) in Lae for animal breeding and new crop variety research.
Our rural people are born agriculturalists. Provide them with cheap or free correct planting materials or animals and they will make that leap. Agriculture will ever remain a myth if this not done – seed is the prerequisite.
Genetic engineering
There is no mention of genetic engineering as a threat to agriculture. In October, 2018 a PNG academic warned that PNG could lose its entire agriculture industry to genetic engineering as it unleashes its might in the next 10 years.
Natural product chemist and head of Chemistry at the University of PNG School of Natural and Physical Sciences Prof Topul Rali has said that “genetic engineers would soon polarise the world in business control, to produce oil and gas in algae, to produce coffee and cocoa in algae, to produce coconut and palm oil in algae or bacteria.
“European countries are leading in this area. We ask can PNG lose its agriculture industry so we have no more coffee export, no more cocoa export, no more copra export? The answer is yes.
“Soon there will be no more tropical climates as greenhouses (using genetic engineering) are being built in desert countries like Siberia and or elsewhere in advanced countries.
“Watch the power of science and technology as it unleashes in the next 10 years, a lesson for the PNG politicians who are blind since 1975”.
Economic growth through agriculture driven by R&D and technology is the way forward which any government cannot ignore if we are to survive the threat of genetic engineering on agriculture.
Currently, the agriculture sector in PNG is underscored, generating around K2.5 billion for the national coffers annually. Justify this through the value chain; from production to processing and marketing and maybe the fourth tier – downstream processing. One can apprehend the value of this one but important sector in our economy, how much it contributes in terms of direct and indirect businesses and spin-offs. So many people, businesses, and the economy depend on it.
In 1977, the agriculture sector contributed as much as 37 per cent of gross domestic product (GDP). Today, the sector contributes less than 25 per cent. In the last 20 years the Department of Agriculture and Livestock received less than 2 per cent of the national budget resulting in a dead-end to its core functions and effective service delivery mechanisms.
The sector continues to suffer as its departmental head position is continually hit by debacle and power struggle. Within 12 months under the watch of Marape, DAL has changed three secretaries and staff performance and morale is at its lowest. This does not help the sector to freedom but captivity. Yet the Government remains shy and quiet.
Hope
Salient steps are now taken by DAL:
1. A National Agriculture Plan is in place,
2. A National Agriculture Standards System is in place, and
3. Drafts of agriculture umbrella legislations including the Agriculture Administration Adjustment Bill and the Agriculture Investment Corporation Bill are ready for Parliament endorsement.
Among the main features in the Agriculture Administration Adjustment Bill, DAL will get back all extension services functions from provinces to headquarters, and an Authority created under DAL to monitor performance of all CEO of commodity boards.
There is more to revamp agriculture to the 1977 level or better. Diversifying cash crop base with new innovative low-cost high-value cash crops like massoy, patchouli, vetiver, and tuberose, downstream processing traditional products like copra, cocoa and coffee into value added tertiary products like soluble cocoa, soluble coffee, and tens of coconut fragrances, food flavour, and pharmaceuticals are the challenges before us.
Inter-sectoral collaborations with universities, the Science, Research and Technology Secretariat and companies under the Government’s R&D initiatives through a responsible, sustainable development strategy will be an honourable way forward.
Prime Minister is correct though; we all have a part to play in this.

• Cyril Gare is a freelance journalist