US leadership vital for development

Editorial, Normal

THE visit by US secretary of state, Hilary Clinton, only two months after the visit by Chinese vice-premier Lee, augers much for Papua New Guinea.
After decades of relative neglect, this tiny nation has awakened more than just philanthropic interest in the major capitals of the world.
Vice-premier Lee made a tri-nation tour last November covering Australia, PNG and New Zealand.
Mrs Clinton does likewise, starting in PNG today, going on to New Zealand and concluding her visit in Australia.
The interest appears immediately obvious. An American company is investing billions of dollars on an LNG project in PNG. China is one of the major buyers of the end project.
ExxonMobil, one of the world’s largest resource companies, is here developing PNG’s biggest ever resource project.
The US$13 billion the company and its partners propose to spend on the project is a large amount of money, even by US standards.
A second LNG proposal led by InterOil has been given the nod by the Government and this project has attracted a major partner in Mitsui Corporation, one of the big players in the Japanese corporate world.
With multi-national companies having invested or are investing, PNG cannot fail to attract more than just commercial interest.
As a major new clean energy source, PNG LNG, is contributing constructively not only to the climate change debate but also towards stimulating economic excitement in this part of the world after the debilitating economic crisis caused by the developed economic over the last two years.
PNG’s impressive tropical rainforest cover and its leadership in the climate change conferences since the Rio Summit has not failed to come to the attention of the big players like the US which have tended to drag their feet rather than lead the world on this issue.
PNG is also of interest in another area where the US does lead the world and this regional stability.
By its geographical positioning PNG is placed, quite uncomfortably and unfortunately, close to the undesirable elements of Muslim extremists operating in the largest Muslim nation on earth – Indonesia.
Events have proven beyond any doubt that terrorism has found root among extremists there and despite the best efforts of the Indonesian government to eliminate it, violence has resurfaced repeatedly.
The war against terrorism has focused its attention on the region and PNG, no doubt, is part of the international and regional geo-political concerns as a potential target or transit for terrorists.
This then is the new era that PNG enters.
Gone is the traditional era of trade and aid, which is negligible and almost redundant where the US is concerned.
The US’ vital historical role in the liberation of PNG during the World War II is part of the local and world history now.
Its new role is undetermined at this point.
The challenge for PNG is to ensure first and foremost that the economic benefits of the resource projects run through the entire economy, which has been lowly performing recently.
 Per capita GDP was falling, poverty increased and all its human index indicators were dropping.
PNG needs a significant boost in economic growth.  More investment is welcome.
Aid is needed still but it has to be channeled to the right areas to boost growth. This is an area where the US government can provide leadership.
In recent years, aid policy in tropical countries has turned its back on leading growth industries. Take forestry as a case in point.  Forestry is rich in the tropical zone.
And conservation is active. Both operate hand in hand.
Developing countries in the tropics have set aside more land for conservation than the rich economies in Europe. 
Yet a vigorous campaign has been run by environmental campaigners and some European governments to halt any further conversion of forest land in areas earmarked for development. 
This has been justified as halting greenhouse gas emissions, although the facts do not support this.
Worse, these strategies will halt the economic development in PNG that local communities want.