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Tuesday, 17 July

06:00

Aid coordination: its all about keeping up with the Kardashians Devpolicy Blog from the Development Policy Centre

Recently I was asked to participate in the Great Debate, an academics versus students comedy debate that is part of ANU Asia Pacific Week, on the topic of Does foreign aid do more harm than good. Myself and the other academics were on the negative team, and managed to keep the crowd on side (who were already supportive of aid at the beginning).

The students put forward some good arguments, particularly around the colonial history of aid, some of the failures of aid, the changes brought forth from non-aid economic growth and technological advancement. But one thing that really stood out, and that stands out time and time again when seeking to explain foreign aid to groups of people with limited knowledge of it even those who maybe have done a development studies class or two is that people dont really understand how aid gets from the developed country to the developing one.

There seems to be a popular misconception that aid is simply a transaction between two countries. That on 1 July each year, Australia opens its internet banking app, flicks Papua New Guinea half a billion bucks and just writes in the transfer description Frm Oz plz spend on health n ed.

This misconception is problematic for a couple of reasons. Firstly, it fuels the idea that aid is just handed over to corrupt governments or dictators without any degree of accountability. Second, it doesnt give a clear sense that there are rules around what aid can and cant be spent on. And third, it really understates the complexity of the global aid system, which leads to sweeping generalisations about everything when one thing goes wrong.

So my goal in the debate was to try to get across the complexity of aid, especially to explain why some project failures dont mean that most aid is causing harm.

I started thinking of ways to describe the range of actors involved in the aid space. Having recently returned from a family funeral that has its own coordination challenges, an extended family immediately came to mind. And the worlds most famous extended family are no doubt the Kardashians.

So, imagine you are in a country called Calabasas, and every Kardashian-Jenner is an aid project. This is what youd be faced with (Ive added some Kardashian kontext for those who might not have been keeping up lately).

Kris Jenner (Kardashian-Jenner matriarch and momager extraordinaire) A very tightly run managing contractor (some might say micromanaged) that delivers results to its beneficiaries, even if the social benefit of its projects is questioned by some. The country government wasnt involved in their project design process but has just had to go along for the ride. Agenc...

Monday, 16 July

11:40

BREAKING THE GRIP OF RH OVER PNG PNGBLOGS


By Frederic Mousseau

OAKLAND, Apr 20 2016 (IPS) - James Sze Yuan Lau and Ivan Su Chiu Lu must be extremely busy men. Together, they are listed as directors of some 30 companies involved in various activities and services related to logging or agribusiness in Papua New Guinea (PNG). The former is the managing director of Rimbunan Hijau (RH) PNG and son-in-law of RHs founder Tiong Hiew King; the latter is executive director of RH PNG Ltd.. All but two of these 30 companies have the same registered address at 479 Kennedy Road, in the national capital, Port Moresbythe headquarter of the RH group in the country.

Their ability to magically fit into a relatively small office space on Kennedy Road is not the only puzzling fact about the subsidiaries of the Malaysian group, Rimbunan Hijau. Out of the 30 above mentioned companies, 16 subsidiaries that are directly involved in logging or agribusiness have one other thing in common. According to their financial records , they dont make a profit. Most of them have been working at a loss for over a decade. During the 12 years for which financial records were available to the Oakland Institutes researchers, all together, the subsidiaries declared an average loss of about US$ 9 million every year.

How the group the largest logging operator in PNG manages to operate at a loss for so many years, and yet still remains in business? If it were unprofitable to log and export timber from PNG, why would these companies continue their operations? These are some of the critical questions raised in a report released in February 2016, The Great Timber Heist: The Logging Industry in Papua New Guinea, by the Oakland Institute. The report exposed massive tax evasion and financial misreporting by foreign logging companies, allegedly resulting in non-payment of hundreds of millions of dollars in taxes.

Recovering tax revenue would be certainly welcomed by PNG given the acute budget crisis the country has been facing in recent months. Yet, it is unclear whether the government of PNG will decide to take action following these revelations. After all, despite the promises made by the Prime Minister, still no action has been taken two and a half years after the damning report on rece...

06:00

Does political stability consolidate irresponsible government? PNG 2012-2018 Devpolicy Blog from the Development Policy Centre

Proponents of political stability argue that stability is necessary for the government to devise and implement policy programs to bring development and provide a favourable business environment, and that changing governments disrupts the implementation of development programs. This view may hold some relevance for Papua New Guinea (PNG). From independence in 1975 to 2002, successive votes of no confidence have removed prime ministers and sometimes replaced the executive in its entirety. No government has ever had the chance to fully implement its policies. In 2002, Ben Reilly noted that Papua New Guineas unbroken record of democracy has not been accompanied by economic development. Figure 1 shows how unstable PNG politics was before 2002. Between 1975 and 2018, even though PNG has had only nine national elections, there were 15 changes to the prime ministers position, many more than just the six times prime ministers were removed after elections.

Figure 1: Number of years of prime ministers occupying office

Source: Adapted from Gelu (2005:86), additions made for 20032018. The figure excludes acting prime ministers. 

Other scholars take the opposite view. They argue that political stability is only a symptom of a much deeper problem. For instance, Jon Frankel and his co-authors argued in 2008 that political instability in Melanesia is a result of MPs who consider access to elected office as the main avenue for power and wealth, and the outcome of a struggle by those MPs not in control of the resources to oust the executive. Those in the executive controlling the resources are then forced to use bribery, coercion and all kind...

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