BY PAUL OATES
MANY PEOPLE HAVE commented on the seeming conundrum that, although PNG is rich in resources, many of its people are relatively poor in material goods and services.
So where does the money go? Some feel it’s just a case of national and international theft. Others are amazed at how hard PNG works for just small returns.
Let’s examine some possible causes.
Firstly, PNG’s rich natural resources must be extracted and processed. Mineral deposits in their natural state are not worth anything and must be smelted and turned into consumer products.
The riches of the ocean and soil must first be caught or farmed and then processed before being able to be consumed. Forests must be cut down in order to be made into furniture and other consumable items.
Given the proviso that PNG’s resources must first be processed in order to be turned into saleable products, how much of this processing and manufacturing takes place in PNG? How many PNGians actually own or have a majority ownership of the processing and manufacturing plants?
Secondly, PNG is not alone in exporting her resources. Australia and many other countries also export raw materials and primary products to many countries. The difference seems to be that Australia obtains significant benefits from these exports.
As a very minor primary producer, however, these benefits do not extend to most Australian farmers and the ability of multinational companies and huge retailers to control the price of products is a sore point.
Lastly, given Australia’s relatively small manufacturing base and local markets, many consumer items have to be imported. The virtual selling out of Australian controlled commodity producers has been increasing over the last decade.
One reason given for this asset sale are that we are part of a global economy, yet the undeniable fact is that many iconic Australian companies have been sold to international buyers.
PNG however had no real manufacturing base to begin with and no large industry involving the production of most of the desirable material goods. Motor vehicles, TVs, mobile phones, computers and all the things the younger generation puts an inestimable value on must all be imported and paid for from the currency obtained from the export of natural resources.
So when the next person asks where their country’s riches have gone, have them look at their lifestyle, what they are spending their money on and who owns the company that produced the item.