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O’Neill’s illegal logging: 1099 days and counting…

June 27, 2016 3 comments

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Peter O'Neill: Theft of forest resources: Guilty

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Three years but still no action to cancel SABL leases

June 26, 2016 Leave a comment

SABL 3 Year Anniversary Advert

O’Neill’s Illegal Logging: Three Years and Counting…

June 24, 2016 2 comments

three years

Prime Minister Peter O’Neill clearly has no intention of ever reversing the huge SABL land grab and giving the stolen land back to its customary owners.

So much for all his promises to revoke the unlawful leases, return the land to rural people and stop the illegal logging!

It is now THREE YEARS since the reports of the SABL Commission Inquiry which detail the widespread fraud and mismanagement that has allowed foreign logging companies to gain illegal access to over 5 million hectares of land.

For three years O’Neill has REPEATEDLY promised us the leases will be canceled and illegal logging stopped.

Peter O'Neill: Theft of forest resources: Guilty

In September 2013 O’Neill said in Parliament:

“We will no longer watch on as foreign owned companies come in and con our landowners, chop down our forests and then take the proceeds offshore”

In June 2014, announcing an NEC decision supposedly cancelling the leases, O’Neill said

“We are taking these steps to reclaim our customary land illegally lost to foreigners with the help of corrupt public servants and leaders”

“As a responsible government we want to ensure that all citizens have access to the lands of their ancestors. We will not allow our land to be lost to unscrupulous people out to con our people” 

In 2015 the Chief Secretary stated:

“It is widely known that vast amounts of pristine forest have been logged to enrich a corrupt few people, while landowners have unknowingly lost their most valuable asset – their land”.

But, despite all the promises, no action has been taken to cancel the leases, landowners are receiving no support from the government in their battles against the land grabbing and WE ARE STILL WAITING for the logging to be stopped.

For THREE YEARS O’Neill has failed to ensure the SABL leases are revoked and has been complicit in the illegal logging of our forests by foreign logging companies.

Prime Minister Peter O’Neill has aided and abetted the theft of logs worth hundreds of million of kina and the destruction of thousands of hectares of pristine forest.

sabl cartoon

O’Neill’s illegal logging: 1092 days and counting…

June 20, 2016 Leave a comment

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Peter O'Neill: Theft of forest resources: Guilty

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Chinese banks to bail out the PNG government?

June 17, 2016 Leave a comment

Papua New Guinea cooks up bond debut

Source:  Finance Asia

The Independent State of Papua New Guinea (PNG) is set to embark on international roadshows next week for what it hopes will be its debut international bond deal. 

The B2/B+ rated nation has hired ANZ, Bank of China, JP Morgan and Societe Generale for a dollar-denominated transaction. 

Central bank governor Loi Bakani and Department of Treasury secretary Dairi Vele will lead presentations in London on June 21, followed by Boston on June 22 and New York on June 23.

The prospective deal comes at a critical time for the country, which is running short of US dollars and wants to raise funds to manage government finances, which are under pressure as a result of low oil prices.

PNG will be hoping it is third time lucky given it has made at least two active attempts to raise dollar bonds over the past decade-and-a-half, both of which failed. Has it got the ingredients right to serve up a successful deal this time round?

One new addition to the mix is the presence of Bank of China on the syndicate. 

Its inclusion underscores a new stage in the internationalisation of Chinese banks as they become more active in the global capital markets. Historically, they have only been able to win mandates from their own credits before, with the exception of ICBC, which was joint global co-ordinator on a deal for the Republic of Angola due to oil-related ties between the two countries. 

Bank of China’s inclusion also reflects the greater role Chinese companies are playing in PNG too. Over the past few years, Chinese companies have started to build up their presence in the country, particularly in the mining sector; something that was not the case when the sovereign last tried to access the market in 2013.

That year state-owned Guangdong Rising Assets Management purchased a $3.6 billion copper project from Glencore (PanAust), which it is still seeking approval for, while Zijin Mining purchased Barrick Gold’s Porgera gold mine in 2015. China Metallurgical Group also has a $2.1 billion nickel-cobalt project.

As such, Chinese investors may well provide some form of backstop for the deal, especially given they have a reputation for being far less bothered about political risk than the emerging and frontier market investors PNG will still need to win over.

In PNG’s case, that may be just as well since political risk will be one of international investors’ chief considerations.

Even by Asian standards, PNG has had a colourful time trying to launch itself into the international capital markets. 

Its first attempt occurred in early 1999 when the then B1/B+ rated sovereign awarded JP Morgan and UBS a mandate to bring a $250 million five-year bond.

But its plans rapidly fell apart when the leads discovered proceeds might end up being used for re-payment of mercenaries. The previous government had hired one such group, Sandline International, to deal with a crisis in Bougainville where protests relating to environmental damage by a Rio Tinto copper project had provoked an attempt at secession.

London-based Sandline had a legally binding contract with the government and had been awarded costs of $18 million by an international tribunal after the government failed to pay its fees in full.

PNG similarly failed in its efforts to get a bond deal off the ground in 2013 after mandating Barclays, BNP Paribas and JP Morgan.

A second key variable, which may act in its favour this time round, is the completion of a $19 billion liquefied natural gas (LNG) project run by ExxonMobil, which is now operational and has the potential to help transform the country over the longer-term. Revenues from the project, which account for 118% of GDP, had been earmarked to lift the country to a new stage of development but have been hit by falling oil prices.

As a result, the government has had to rein in spending by 17% so far this year. Standard & Poor’s believes it will be successful and achieve a budget deficit of 4.6% compared to 5.6% in 2015. 

In terms of pricing a new bond deal, there are a number of Asian nations with ratings close to PNG including Sri Lanka with its B+/B1 rating, Pakistan on B3/B-/B- and Mongolia on B2/B.

Sri Lanka and Pakistan both have 2019 bonds outstanding, which yield 5.1% to 5.2%. However, it seems far more likely that Mongolia will provide a better comp given it is also struggling with an economy that has been hit by declining commodity prices.

Its 2021 bonds are currently trading at the 10.2% level and it seems highly unlikely PNG will be able to better this given Mongolia already has an established track record.

PNG’s credit ratings are also heading in the wrong direction. Earlier this year it was downgraded by Moody’s from B1 to B2 and is now on stable outlook.

However, it has been on negative outlook with S&P since 2007.

In its most recent ratings release, S&P said low global energy prices are “weighing on the economy, export receipts and government revenues”. It added that this is coinciding with large increases in external and fiscal imbalances but noted the government is responding “forcibly” to deal with them.

The agency also highlighted how the country ranks a lowly 155 out of 188 on the UN’s Human Development Index and flagged a high level of urban crime: something international bankers who have visited the country are very familiar with given the presence of armed guards as escorts every time they leave their hotel. 

O’Neill’s illegal logging: 1,085 days and counting…

June 13, 2016 1 comment

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The Prime Minister seems to have no intention of ever reversing the huge SABL land grab and giving the stolen land back to its customary owners.

Instead, proposed changes to the Land Act will allow the illegal leases to run for their full 99 year terms.

So much for all the promises from Peter O’Neill to revoke the unlawful leases, return the land to rural people and stop the illegal logging!

It is now 1,085 days since Peter O’Neill was told that the SABL leases were unlawful and should be cancelled.

On June 24, 2013 O’Neill was given the reports of the SABL Commission Inquiry which detail the widespread fraud and mismanagement that allowed foreign logging companies to gain illegal access to over 5 million hectares of land.

For three years O’Neill has REPEATEDLY promised us the leases will be canceled and illegal logging stopped.

In September 2013 O’Neill said in Parliament:

“We will no longer watch on as foreign owned companies come in and con our landowners, chop down our forests and then take the proceeds offshore”

In June 2014, announcing an NEC decision supposedly cancelling the leases, O’Neill said

“We are taking these steps to reclaim our customary land illegally lost to foreigners with the help of corrupt public servants and leaders”

“As a responsible government we want to ensure that all citizens have access to the lands of their ancestors. We will not allow our land to be lost to unscrupulous people out to con our people” 

In 2015 the Chief Secretary also declared the leases a corrupt scam:

“It is widely known that vast amounts of pristine forest have been logged to enrich a corrupt few people, while landowners have unknowingly lost their most valuable asset – their land”.

But, despite all the promises, no action has been taken to cancel the leases, landowners are receiving no support from the government in their battles against the land grabbing and WE ARE STILL WAITING for the logging to be stopped.

For 1,085 days O’Neill has failed to ensure the SABL leases are revoked and has been complicit in the illegal logging of our forests by foreign logging companies.

Prime Minister Peter O’Neill has aided and abetted the theft of logs worth hundreds of million of kina and the destruction of thousands of hectares of pristine forest.

Peter O'Neill: Theft of forest resources: Guilty

Disgraceful shootings of students must be promptly investigated

June 9, 2016 2 comments
shot student

Injured student is rushed to emergency room in Port Moresby after police shot into crowd of peaceful protestors (Getty Images)

Amnesty International

The shooting of students peacefully protesting in Port Moresby, the capital of Papua New Guinea, is a disgraceful attack on the rights to freedom of peaceful assembly and expression.

Amnesty International has received information that there are 38 people injured, including four in critical condition. Three people are still being assessed in emergency.

“The shooting of students peacefully protesting is reminiscent of the worst excesses of repressive regimes in the region,” said Rafendi Djamin, Amnesty International’s Director for South East Asia and the Pacific.

“Papua New Guinea’s authorities must establish a prompt, impartial and independent investigation to determine who is responsible for the unnecessary and excessive use of force.”

The Papua New Guinea police opened fire today on a group of students at Papua New Guinea University who were peacefully protesting against the alleged corruption of Prime Minister Peter O’Neill.

Several eyewitnesses have come forward to say they saw students beaten and shot at, including one case where a student was shot in the head.

In a statement, Prime Minister O’Neill blamed the violence on the students who had set out from their university for a peaceful protest at parliament. Before any investigation has taken place, he has denied that the police targeted the students, claiming that their only response was the use of tear-gas and “warning shots.”

“Prime Minister O’Neill’s reaction has been completely inadequate. He should ensure an investigation worthy of its name takes place into reports of excessive use of force. Instead, he has prejudged the outcome, blamed the students for what happened to them, and sought to evade accountability,” said Djamin.

Prime Minister O’Neill told parliament that an investigation into the shootings at Papua New Guinea University will take place. It is not clear who will carry out the investigation, when it happen, or whether it will be independent of any government or police interference.

“It is not good enough for the authorities to investigate themselves,” said Djamin. “The Papua New Guinea government is trying to absolve the police of all responsibility for the unlawful use of force.”

Claims by the Papua New Guinea authorities directly contradict several first-hand accounts reported of the violence.

Outside Papua New Guinea General Hospital, families and friends of students who were attacked were peacefully protesting the shootings. Hospital officials have said that they heard shooting outside the hospital.

“The police must exercise restraint and respect the right to peaceful protest. Firearms must only be used when strictly unavoidable in order to protect life,” said Djamin.

Background

Since May, Prime Minister O’Neill’s government has been the focus of sustained student protests over allegations of corruption. O’Neill is accused by PNG’s Taskforce Sweep of allegedly authorizing payments for fraudulent legal bills amounting to USD $22 million.

The students have used peaceful methods, including protests and a boycott of classes.

Prime Minister O’Neill has lashed out at the students for taking part in the peaceful protests, deriding them as poor performing students and warning that they will have to “face the consequences” in terms of their academic prospects