New Internationalist

Aid off the mark

December 1979

Trying to step out of Australia’s shadow has proved difficult for Papua New Guinea, especially since Australian aid makes up such a huge proportion of PNG’s budget. ROBIN OSBORNE looks at the results of such an intimate relationship.

The problems Australia originally had establishing a profitable settlement in Papua New Guinea were considerable. But they were determined to make a go of it. And in time they did - creating a booming plantation economy. Cocoa, coffee, and copra were the glamour harvests then, joined after by timber, gold and, in later days, by copper mines on Bougainville Island.

In the classic expatriate way they endeavoured to ‘civilize’ as much of the country as possible in the Australian style. Inland towns were laid out around airstrips, with building regulations and services based on Australian life patterns. Individual family houses sat on their own plots, facing the street, as in any Australian town,

As the development model was indisputably to be Australia’, explains Neil O’Sullivan, of the Australian agency Community Aid Abroad (CAA), ‘it was clear that a considerable amount of money would be needed if the model was to be a success. That echoed the typical Western attitude that money can solve any problem’.

Money was not slow in coming, partially as a result of Canberra’s desire to assuage its colonial guilt. In 1972/73, the year when proposed independence was announced, Australian aid comprised over 60 per cent of the total PNG budget.

Since then the percentage has fallen to 56 per cent, although the total has risen dramatically. This year PNG receives $215 million, making it one of the most aided countries in the world on a per capita basis. Military aid accounts for a further $13 million.

While obviously well intentioned, the PNG government often appears schizophrenic. Its official development program features such ideals as ‘a more self-reliant economy, less dependent for its needs on imported goods and services, and better able to meet the needs of its people through local production’. Yet one sees numerous villages where fields of taro, a local staple, have been moved to a distant site and their place usurped by coffee, an export crop. A village’s cash crop earnings are invariably spent on imported items such as Japanese canned fish, Australian canned meat, electrical equipment and beer. Australia’s exports to PNG total five times its imports.

One moment planners will eulogize the benefits of appropriate technology and the next talk of developing the Purari hydro-electric scheme (which Japan is eager to finance to the tune of $1 billion) and turning PNG into ‘the Saudi Arabia of the 1980’s.

Unless courageous steps are taken PNG seems destined to remain trapped between the devil of aid and the deep blue sea of foreign investment. As aid begins to scale down a ‘see-saw’ emerges; foreign investment rises as aid falls.

Current projects listed in the Finance Department’s foreign investment guidelines include a proposed copper/gold mine at OK Tedi, a copper project at Frieda River, forestry in West New Britain, a tuna cannery on Manus Island; plus rubber, cement, sugar and petroleum projects. Most would be financed by multinational corporations.

Little, if any, of this activity tallies with the professed ‘Eight Aims’ for national development. Predictions for the 1980’s show that over half the nations’ rural income will be controlled by foreigners, while probably 95 per cent of all business profits will go to outsiders.

A recent advertisement in the overseas Guardian Weekly, seeking staff for a Southern Highlands Rural Development Project funded by the World Bank, indicates the ends to which the PNG Government will go to attract ‘desirable’ foreign assistance.

Foreign aid workers are offered ‘a fully equipped four doctor hospital, pre-school, international school to primary level (Australian curriculum), two banks, comfortable hotel and social clubs, recreation including golf, tennis, squash, a swimming pool, trout fishing, caving and bush walking’.

And workers have been in PNG for far too long. Recruitment efforts like this one show just how thoroughly their attitudes have rubbed off, and how far off the mark aid can stray from development.

Robin Osborne is an Australian journalist.

This feature was published in the December 1979 issue of New Internationalist. To read more, buy this issue or subscribe.

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This article was originally published in issue 082

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