Archive for September, 2010

More tuna sweat shops for Madang one step closer

September 30, 2010 Leave a comment


Papua New Guinea is poised to be the tuna hub of the Pacific and the world in the coming years as a result of the contract signing of phase one of the construction of Pacific Marine Industrial Zone (PMIZ) project in Vidar, Madang, The National reports.

Commerce and Industry Minister Gabriel Kapris made these remarks during the signing of the general contract between the PNG government and the international contractor Shenyang International Economic & Technical Cooperation company of China at Government House yesterday.

“The signing of the contract between both parties is close to complete and the process of evaluation by the China Export Import (Exim) Bank is to allow for the draw-down of US$74 million to construct PMIZ infrastructure.

“The PMIZ project is an initiative of the national government through the ministry of Commerce and Industries and National Fisheries Authority.

“Phase one of the project will be at the cost of US$95 million (K210 million) and the balance of US$21 million (K67 million) will be provided by the government as counterpart funding for the project.”

Kapris said construction of phase one would include wharf and pier, water treatment plant, waste treatment plant, roads, administration and other key infrastructure.

“Construction is expected to start in early 2011 and completed by the end of 2013.

“Phase two of the project is yet to be established but is expected to cost more than US$100 million,” he said.

Kapris said the funding for the project was secured through bilateral arrangement between China and PNG.

A framework arrangement was signed last November during the vice premier which allows for the state to access the concessional loan from Exim Bank of China.

Kapris added that the condition of the concessional loan was for the main contractor to be a Chinese company selected by the bank through their own selection process.

“The construction of PMIZ is to create a regional tuna processing centre which will provide an opportunity for regional member countries and PNG tuna industry to set up processing plants within the zone, add value to their tuna catches and supply export markets,” he said.

Shenyang International president Tan Lezhen said: “It is a privilege to combine our efforts because this is a productive project”.


McKinseys paid US$2.2 for 4 months work on REDD

September 27, 2010 4 comments

International consulting firm, McKinsey & Co, was paid US$2.2 million by the PNG government for four months work in 2009 to prepare a draft ‘National REDD and Climate Change Plan’ ahead of the global Copenhagen summit.

McKinsey’s confidential memorandum to the PNG government, “Supporting the Development of PNG’s National REDD and Climate Change Plans”, reveals how PNG’s position for the Copenhagen summit was developed by a team of ‘international consultants’ – all from Australia, the US and Europe.

Far from developing its own indigenous, Papua New Guinean plan, the PNG government was happy to pay almost K6 million for a team of foreign consultants to produce a plan offshore – just so the government had some glossy documents to present in Copenhagen in the hope of duping the international community to channel billions of dollars into its coffers.

Of course the money the PNG government was spending on this costly exercise was not its own money but money taken from the public purse – money that could have been spent on health care or schools.

PNGs whole REDD strategy is being run off-shore by American consultant Kevin Conrad and his Italian mistress with no accountability in Papua New Guinea or consultation with forest owners, bureaucrats or politicians.

PNG’s REDD strategy has never been debated by PNG’s Parliament or disclosed to the PNG people.

Activist warns PNG government about anti Asian tensions

September 21, 2010 2 comments

From Radio NZ

A planned protest later this week against controversial moves by the Papua New Guinea Government will also ask for a committee set up to investigate anti-Asian rioting last year to be re-established.

Activist Noel Anjo wants people marching over issues such as cuts to the authority of the Ombudsman, the abuse of parliamentary process and limits on the rights of landowners to seek redress over environmental damage.

Despite Government claims, he’s denied any involvement in recent anti Asian rioting in Eastern Highlands province, but says the people remain concerned by the issues that sparked similar violence last year.

He says the Government can’t ignore the anger.

“You know, do something about it. But this issue is still, the tension is still very high and the Government must do something. They way you see these things are happening. I am warning the Government that there are signs of bigger things to come.”

Ramu mine company posts huge profit

September 20, 2010 1 comment

The Chinese State-owned MCC corporation which owns the Ramu nickel mine in Papua New Guinea has posted a huge profit for the six-months to June 2010 of US$540 million. This profit was generated from revenues of over US$13 billion.

In that period the company has also moved from being ranked as the 380th biggest company in the world to a new ranking of 315th.

The company’s six-month profit of US$540 million puts in stark perspective the losses the company claims it is making on its stalled Ramu mine project which is currently on-hold after landowners obtained a court injunction preventing construction of the mine’s proposed deep sea tailings disposal system.

While in PNG, MCC has been crying over the amount of money it says it has been loosing, it has not been  revealing the massive profits it has been reaping from its transnational operations.

The company’s six-month financial report (warning: file size is 4.5mb) also paints a very different picture about the size of the company’s investment in the Ramu project to that which it claims in PNG

At page 48 the report says the company has invested US$250 million (which is equivalent to less than 3 months profit for the company).

This is a whopping $600 million LESS than MCC executives have claimed the company has invested in their sworn evidence to the National Court sitting in Madang.

Further evidence of the insignificance of the delays to the Ramu project to the company comes on page 53 of the report where the company acknowledges NO new material litigation.

This is an acknowledgement from MCC that the delays and costs to the Ramu nickel mine associated with the court case and injunction are immaterial and of no significance to the company’s overall financial position and profitability.

President Clinton’s support for super-hospital locked in says Paki

September 15, 2010 5 comments

Former President of the United States, Bill Clinton, has confirmed his personal support for the Papua New Guinea government’s heavily criticized Pacific Medical Centre and will be confirming his position in a public statement later this month, according to a leaked email from PNG Ambassador to the USA, Evan Paki.

Mr Paki claims that President Clinton confirmed his personal support for the Pacific Medical Centre in a personal meeting with PNG Prime Minister, Michael Somare, in New York on April 2nd.

He further states that President Clinton will making his support public in a major announcement in New York during the annual meeting of the Clinton Global Foundation in late September. At the same time President Clinton will also announce funding support for the project from the Clinton Foundation.

Mr Clinton will them embark on a major fundraising effort on behalf of the PNG government to attract other governments, Foundations and corporations to support the project.

The government’s proposal for the K500 million Pacific Medical Centre which was announced in February has met with strong criticism form local health experts and PNG’s former Prime Minister, former Health Minister and former Treasurer. All question whether the hospital will provide any benefits to PNGs mainly rural population  and believe the monies would be much better spent on improving service delivery and the medical infrastructure at a local and Provincial level.

The questioning of the project by health professionals led to an virulent and unseemly attack on them by Health Minister Sasa Zibe – an attack that surely would have embarrassed a statesman like President Clinton.

The lack of transparency about the government’s proposal has also led the Port Moresby Chamber of Commerce to question the bona fides of the project.

Evan Paki’s email

Mr. Christopher Hulape
Office in Charge
Ministry of National Planning and District Development
Waigani, NCD

Dear Mr. Hulape,

It was a pleasure to see you, along with Planning Minister, Planning Secretary and the rest of your colleagues from Waigani.

As discussed over the phone – and as you are aware, Prime Minister and National Planning Minister (accompanied by me) met President Clinton on Friday 2 April 2010 in New York for about 80 minutes; in the course of the discussions on the Pacific medical Center (PMC) project (among other matters relating to the PNG LNG project and other issues/matters of bilateral significance), President Clinton agreed to support PNG to accomplish the Pacific Medical Center (PMC) project in view of its transformative nature and importance to PNG’s national healthcare sector; this pledge of support came after President Clinton was convinced that the PNG government was committed to the PMC Project.

President Clinton indicated he would be making a major announcement of his support – and the Clinton Foundation’s support – for the PMC project in late September 2010 in New York City during the annual meeting of the Clinton Global Initiative.

President Clinton’s support for the Pacific Medical Center project would also see him reach out to other western governments and corporate leaders to support the PMC as a major healthcare initiative for our entire nation and other Pacific Islands nations; this would include President Clinton’s outreach – on PNG’s behalf – to the leaders of other nations that provide PNG bilateral development assistance, founders/CEOs of major foundations in the U.S. and  CEOs of major corporations that have various business interests in PNG and other major prospective partners to get them involved in supporting the PMC project would as well.

Now in terms of the way forward, we’ll be meeting with the Clinton Foundation’s health team and other US-based partners and supporters (mostly teaching hospitals, medical schools and universities etc) and members of the US-based  PMC project team in the coming days and weeks to, among other things, advance the PMC project from within the United States.

On the ground in Waigani (as discussed), we, as a government, need to do a number of things in the coming days and weeks to take advantage of the global support and interest that this Cabinet-endorsed significant healthcare project is generating:

(a) prepare for the proposed launch of the PMC project in Port Moresby sometime in May or June 2010 (to enable this major  healthcare project to gather more momentum in the lead-up to President Clinton’s public announcement in New York in September 2010); and

(b) work towards including the PMC project in the national government’s national budget or the government’s infrastructure development budget for 2011 (e.g. in the National Planning’s PIP Budget), as discussed with the Planning Minister and Prime Minister, in the wake of President Clinton’s commitment towards the PMC project).

While work in relation to (b) – the budgeting process – might require additional meetings/consultations (with the National Planning and/or Treasury departments) – as well as the PMC project team’s being able to produce more details with respect to the Project’s costs and ‘revenue’ projects (which I understand they’re working on) – I would ask you and your colleagues to urgently assist in relation to confirming the Planning Minister’s availability and the availability of other key leaders, including: the Prime Minister; Deputy Prime Minister; Treasurer and Finance Minister; Foreign Affairs Minister; Minister for Public Enterprises; and of course the Health Minister; and other Ministers for the launch in late May or early June 2010; and the respective secretaries of each of  the relevant departments.

Please note that the Prime Minister – when in New York – indicated that the third week of May 2010 would be an appropriate week for the launch of the PMC project (before he departs for Norway on or about 27 May 2010, as he told me). Based on that, interested U.S partners/supporters and members of the PMC project team are  tentatively considering Tuesday 18 May 2010 as the proposed date for the launch, hoping that date is also convenient to the PNG government. But we’ve just been informed that the Health Minister (and perhaps other leaders?) might be away on official engagements on that date (assuming that/those official engagement(s) could not be re-scheduled).

In view of this, please consult with the above-mentioned Ministers’offices/ Ministries  – as noted above – and specifically confirm the Prime Minister’s availability (I rang and left a message for Mr. Leonard Louma, PM’s Foreign Relations Advisor) and that of the Deputy PM, Planning Minister, Treasurer and each of the key Ministers referred to above during the third week of May and/or early June 2010; as discussed, if NOT May 18, 2010, we need to confirm a date within that week for the PMC project launch or a date within the mid-May to mid-June 2010 period when all (or most) of our key leaders are available, especially the Prime Minister.

The PNG launch would further demonstrate not only the national government’s commitments to this major healthcare initiative but also it would significantly enhance the positive momentum that has been created thus far in terms of the global support and commitments towards the PMC project(the most significant of which is President Clinton’s support and commitment to the PM that he will work with PNG to help ensure that it is successful).

Please let me know as soon as possible so we (through the Health Ministry and National Planning Ministry) can work on sending the appropriate invitations out to PMC’s local and global partners and supporters, as well as prospective or new partners/supporters in the U.S. and within PNG.

I look forward to your responses. I am also contactable via mobile phone 051(202) 391 4667 if you or Planning Minister or Planning Secretary (or anyone who is copied in on this email) need to discuss any aspect of this important matter.



Evan Jeremy Paki
Embassy of Papua New Guinea
1779 Massachusetts Avenue, NW
Suite 805
Washington, DC 20036
Telephone (202) 745 3680
Facsimile (202) 745 3679

DEC deputy concerned by Director’s dictatorial powers

September 14, 2010 Leave a comment

Former Deputy Secretary in the Department of Conservation, Gae Gowae, has taken a swipe at his former bosses wide discretionary powers and dual role as regulator and overseer which he says “defeat the whole process of good governance”.

Gowea, in a letter published in The National, says the recent increase in environmental concerns in the country is a reflection of major flaws in the Environment Act 2000 and the lack of transparency and accountability

He is  calling on the Minister and responsible authorities like Law Reform Commission and Department of Justice and Attorney-General to critically look at tthe Act and recommend for the review.

Under the Act Wari Iamo, as Director of Environment, automatically becomes the chairman of the Environment Council, which Gowae syas is highly questionable as the Council should act as a check and balance on the decisions of the Director.

The Act gives the Director the discretion to determines the level of and activity and therefore whether an environment impact assessment is required. He also decides on the environmental inception report (EIR) and makes assessment of the environmental impact statement (EIS). He also decides on the public review and submissions process and makes a decision on the EIS and refers it to the Council.

As Chair of the Council, the Director then presides over the review of his decisions and recommendations, and the Council’s decision and recommendation to the Minister.

The Minister’s approval-in-principle is also highly questionable according to Gowae as the whole process leading to the Minister’s approval is based simply on the statements on the issues raised in the EIR.

After the Ministers approval in principle, the issuing of the Environmental Permit is again at the sole discretion of the Director of Environment.

Gowae says this whole process “is totally an insult to the moral principles of good governance in the country”.

China has big plans in PNG

September 14, 2010 4 comments

The US$1.4 billion dollar Ramu nickel mine is just one small part of China’s planned expansion into Papua New Guinea.

The Chinese Premier knows exactly what China wants from PNGNautilus Minerals has confirmed the Chinese are lining up to take a controlling interest in the Solwara 1 undersea mine. Solwara will be the world’s first undersea mining operation and will produce both copper and gold.

The Chinese are also likely to fund the Yandera copper and gold mine in Madang Province. Marengo Mining, which is conducting the mine exploration estimates the project will cost US$1.6 billion to bring into production.

Like the Ramu nickel mine, Yandera will use the controversial marine dumping to dispose of the mine waste.

China is also looking to expand its manufacturing capacity in PNG – but on its own terms.

The PNG government is currently negotiating a loan from the Chinese government for China to build the Pacific Marine Industrial Zone which will be the first Special Economic Zone in PNG.

Within the zone Chinese companies will be able to operate tax free and avoid local wage restrictions and health and safety laws.

This will provide a perfect setting for the Chinese to process the gold produced from the Solwara and Yandera mines.

But China’s interests alos extend to other resource sectors.

A Chinese company, Zhoushan Zhenyang Deep-Sea Fishing Co, a subsidiary of Zhejiang Hailisheng, is already building a $20 million tuna processing factory in Lae. Other Chinese companies already hold licences to fish in PNG waters.

China is also the biggest consumer of unprocessed logs from PNGs rainforests. China imports around 80% of PNGs log production every year.

With all this investment the future unfortunately is not bright for PNG.

The logging of PNG rainforests already causes plenty of environmental damage and the marine disposal of waste from the Ramu, Solwara and Yandera mines will only compound the negative environmental impacts.

Just as importantly, the investments will do nothing to help PNGs disadvantaged poor.

As the Lowey Institute in Australia has pointed out, large-scale resource projects in PNG do not alleviate poverty as most jobs are taken by foreigners, profits are taken off-shore and government revenues are not spent wisely.

Such projects also bring well-documented social problems that include increased violence (especially against women), landowner disputes, drunkenness, gambling prostitution, and increased HIV/Aids infections and other STDs.

So while China will benefits hugely from its access to PNGs natural resources, and PNGs Prime Minister, Michael Somare, will continue to enjoy the largess of the Chinese Communist Party, Papua New Guinea’s indigenous people are in for a very rough ride.