Politics
Frustration Builds Up, MPs Blamed For Mess
Somare fails to address the plight of the poor
Two people were engrossed in what appeared to be a deep and serious conversation. One was a customer and the other a vendor on a busy residential street in Papua New Guinea’s capital, Port Moresby.
It was just a friendly chat. Suddenly, the vendor raised his voice in a quivering angry tone that drew the attention of those nearby. The once friendly face lit up in anger.
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The burnt-out cigarette butt that still dangled between his fingers shook like a twig in a heavy wind as he spoke: “Let’s burn the Parliament House. We must burn it down. The leaders are responsible for all this mess.”
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It was written all over his face. He was furious. The red betel nut froth that gathered on the sides of his mouth trickled down the sides as he roared. He looked about him to ensure he had not created any enemies by saying what he had said.
No one uttered a word. But one could sense a general agreement that leaders were responsible although they may not necessarily support the suggestion to burn down the Parliament House.
He took this as an encouragement to complete what he had in mind. He said: “Life may still be affordable for workers, but what about us,” he said as he stooped over his betel nuts neatly set out in rows on a table before him. No one knew what went on in his mind. It was a while before he looked up again.
Though he was disturbed deep within, he forced an innocent smile. He did not want to scare his customers. Without them, he would not sell his betel nuts. It is his only means of survival in the city.
His partner in the conversation stood silently near him. Then he trundled off mumbling: “Yeah, the prices of goods have gone up but the pay remains the same.”
He appeared to have lost hope. His simple attire implied he may have been an industrial worker of some sort, but he was definitely not going to work. The bus stop to work was the other direction. He was going back home.
On the same day in a packed bus, someone who may have been harassed for not paying the right fare, poured out his frustrations.
He took to lecturing everyone in the bus about the rising standard of living, which the country is experiencing.
“You all should know that the prices of everything have gone sky high. The price of tinned fish, rice, petrol, electricity, airfares and everything else is going up. It won’t be long before the bus fare goes up as well. What’s going to happen to us?”
Another commuter at the bus stop said: “We have failed to look after ourselves. We might as well give up our sovereignty to Australia and become an Australian state.”
Another asked: “What can we do in a leaderless society?”
It’s reality in Papua New Guinea. Anyone randomly asked about the situation will arguably say the same or something similar and definitely not be a positive answer. It’s the topic of every conversation in towns in the country.
The situation has stirred up speculations of sorts. Someone was overhead during a discussion at another betel nut market that all the notes and coins of the local currency, kina, will eventually be replaced with electronic cards which can only read finger prints. There are so many other stories.
The country’s new government under Prime Minister Sir Michael Somare was expected to do something about the country’s social, political and most importantly, its economic woes.
It took office at a critical time five months ago and was generally expected to carry on from where the former prime minister, Sir Mekere Morauta, the country’s most experienced financial and economic expert, had left off. However, it decided to start afresh with its own ideas and style of governance.
Unfortunately, its style, driven by nothing but self-pride, nearly sent an important donor, the World Bank, packing over its fracas regarding the bank’s involvement in the country’s forest industry.
The government’s same overbearing attitude had influenced Australia, Papua New Guinea’s most mutual friend, to become reluctant to provide extra help.
Its decision to halt Morauta’s privatisation programme, an important element supported by Australia and the World Bank under the reform programme, did not help its position.
The introduction of a supplementary budget soon after taking office did not help either. Weeks after introducing the budget, the value of the kina dropped to its historical low in October/November.
The government has now realised it won’t win with its arrogant approach towards Australia and the World Bank. It has now begun working to mend the relationship.
There was some hope after the government handed down the 2003 “rescue” budget. At least there were no new personal income tax burdens and the struggling mining sector gets a boost with new incentives.
The government has also put a big slice of its K3.7 billion budget expenditure in major “impact projects” like the Highlands highway to help boost agriculture.
Treasury Minister Bart Philemon said seven core objectives have been set for 2003.
These are—
- alleviate pressure on the kina;
- reduce demands on domestic financing;
- reduce inflation;
- facilitate and ease monetary conditions;
- reduce interest rates;
- stabilise foreign exchange reserves;
- commence a fundamental restructuring of the budget to focus on more productive outlays;
- allow entities to operate with greater certainty;
- achieve better budgetary outcomes; and
- establish a platform for robust broad-based substantial growth.
Unfortunately, there isn’t much in terms of relieving people of the current financial burden they have been living through.
This can never be explained any better than through the words of Morauta when delivering the Opposition’s reply to the budget in Parliament in December.
The former prime minister said people have good reasons to be dissatisfied with the Somare Government’s 2003 Budget.
He said the government has managed to find enough money to provide incentives to large mining and petroleum companies as highlighted in the budget. But it has not been able to provide relief for the poorest citizens.
“My government’s policy of almost complete subsidy for education has been abolished. My tax relief scheme for the lowest-paid workers has been abandoned,” he said.
“The cost of cigarettes and beer will rise because of excise duty increases, and will rise automatically periodically because excise duty has been indexed. Relief from the recent rise in inflation is what is needed, not increases in prices.
“Papua New Guinea needed a budget for 2003 based on good policies and competent leadership.
“Instead, we have a budget that is skewed towards a distant, uncertain future, and inadequately addresses our immediate needs.”
He described the budget as one based on “wishful thinking”, saying the future was still gloomy with prices continuing to rise and recession set to deepen.
“The nation, and the international community, needed to see in the budget a clear policy framework and path that addresses our current problems. Instead, we find wishful thinking and uncertainty,” said Morauta.
He said there is only “sweet-smelling” and “flowery” talk about poverty reduction and empowering people.
But there is nothing of substance in the budget.
The exact opposite exists, including making education expensive, allowing cost increases through higher interest rates, a weaker kina and new taxes on business.
Morauta’s comments appear to be in complete agreement with an economic commentator and former departmental head, Isaac Lupari.
Writing in his column in The Independent newspaper, Lupari highlighted in detail what he described as shortcomings and fallacies in the budget.
Lupari said the physical framework of the budget has serious fallacies and as such it will not deliver the projected 1.8 percent growth in GDP and fiscal monetary targets will not be achieved.
“The kina will decline further, interest and inflation rates will rise, international reserves will fall, debts will increase and unemployment will rise.
“These will plunge the country into serious economic and financial crisis, which could prove difficult to manage,” Lupari said.
