Both the O’Neill camp and the Somare camp claim that the Constitution must be upheld. There is no question about the desire of both parties to uphold the Constitution. Many other community leaders also expressed similar sentiments.

The problem however, is the nature of the constitutional law. No one has yet expressed what the constitutional law says about this conflict. People use phrases like “uphold constitutional law” or “respect the rule of law” or “respect the ruling of the court” to justify their positions.

What is the constitutional law that must be upheld and respected? I will try to be brief in my explanation.

First, the constitution provides for separation of powers between the three arms of government. This is provided for in Section 99 of the Constitution.

Second, separation of powers means simply that no arm of government must interfere with the workings of the other arm of government.

Third, I have read the orders of the Supreme Court. I have a fundamental problem with the nature of the orders. The Supreme Court’s power under a Section 19 reference is a limited reserve power only. Here the court’s power can be invoked only for an opinion as to the state of the law.

The court has no power under Section 19 to make permanent orders in the nature of those made on 12 December 2011 and especially order No 6 which states emphatically that Sir Michael Somare is restored to the office as Prime Minister.

These orders are not opinions for the purposes of Section 19 of the Constitution. The effect of order no. 6 is to assume the powers of the National Parliament and to infringe the principles of the separation of powers. In doing so the court has acted beyond its powers under section 19 of the constitution and infringed the principle of separation of powers.

Fourth, is it possible to come up with a reading of the ruling of the Supreme Court to avoid that conclusion? My answer would be that yes, it is possible to do so. The court orders numbered 1 through to 5 were opinions of the court. Court order No. 6 that directed restoration of Sir Michael Somare to the office of the Prime Minister is a nullity and is ineffectual for the reasons to be outlined below.

Fifth, leaving aside the issue of court acting beyond its powers under Section 19 of the Constitution, my reading is that the court has clearly interpreted the law as it stands on 2 August and 6th of September 2011.

It should be stressed that the Court has not considered and dealt with the factual situation of what happened after 2 August or 6 September. Clearly much has taken place after that date. The world goes around twenty four hours a day. The clock cannot be turned back. It cannot come to a standstill. We cannot live in the past.

We must now interpret the ruling of the Court based on events that took place after 2 August 2011. It is also important to note that the Court did not make invalid anything that happened between those dates and 12 December 2011.

Sixth, we all know what happened after 2 August 2011. Most importantly two important events did take place. On 9 December 2011, Parliament rescinded its earlier decision in May to grant leave of absence to Sir Michael Somare for the May sittings of parliament.

Is this decision wrong in law? No, it is not wrong. Parliament is clearly empowered in law to do that. The authority for this statement is to be found in Schedule 1.10(3) of the Constitution which states:

“(3) Where a Constitutional Law confers a power to make any instrument or decision (other than a decision of a court), the power includes power exercisable in the same manner and subject to the same conditions (if any) to alter the instrument or decision.”

So parliament has the power to alter its decision to grant leave of absence to Sir Michael for the May sittings of parliament.

When that decision was taken, it clearly meant that Sir Michael is automatically terminated as a member of Parliament by virtue of Section 104(2)(d) of the Constitution. Is parliament interfering with the workings of the judiciary? My answer would be no, because parliament is empowered by law to do what it has done.

The correct position for the lawyers, of both sides in the Constitutional Reference before the Supreme Court, to take on Monday 12 December was to bring this fact to the attention of the Supreme Court and as Sir Michael ceases to be a member of parliament on 9 December 2011, the questions before the Supreme Court are no longer valid, are then moot and the court must be asked to vacate further conduct of the proceedings and not to deliver its opinion on the question of reinstating Sir Michael as the Prime Minister.

Obviously, the lawyers in the Supreme Court Reference did not see the obvious solution and proceeded to fuel the situation further by not bringing the decision of parliament on 9 December 2011 to the attention of the Court and ask the court to vacate further conduct of that case.

Seventh, is the decision of parliament on 9 December 2011 sub-judice or does it amount to contempt of court? This appears to be the position of Arnold Amet and the Somare camp. I do not hold the view that this argument is valid at law.

My view is that members of parliament and proceedings of Parliament are not subject to this rule of law which is to be found in Section 160(2) in respect to Supreme Court and Section 163(2) in respect to National Court. This is because of the principle of separation of powers contained in Section 99 of the Constitution and especially Section 115 (1), (2), (3) and (4) of the Constitution.

These sections provide for the inviolability of the person of a member of parliament in respect to his statements, debate and proceedings including decisions taken by parliament. As such it is not possible to haul any member of parliament, who voted for the decision to rescind the leave of absence granted to Sir Michael in May, before the Supreme Court on a charge of contempt of court.

This section has a long legal and constitutional law history that is founded on the Cromwell wars with the King of England which ultimately resulted in the transfer of much of the royal powers to the House of Commons.

More importantly also is the principle of law that says that when a matter is specifically provided for in legislation, it overrides a general power. The power of court to punish someone for contempt of court is a general power that is negatived by the specific privileges of members of parliament provided for in Section 115 of the Constitution. The Somare camp will have to find some other reason to challenge the validity of the decisions taken by Parliament.

Accordingly, upon the taking of that decision on 9 December, the East Sepik Regional seat in parliament automatically falls vacant. Sir Michael Somare is now a stranger in parliament and if he tries to step inside the chamber, he will be removed by the Sergeant-at-Arms.

Sir Michael is no longer eligible to hold the office of the Prime Minister as Section 141(a) of the Constitution defines and provides for the nature of the Ministry. It says simply that no person who is not a member of parliament is eligible to be appointed as a minister and this also applies to the Prime Minister as he is one amongst equals.

The court therefore cannot appoint a person who is not a member of parliament into the office of the Prime Minister as at 12 December 2011.

Members of the judiciary must also know that they cannot bring parliament before them. The principle of separation of powers must never be compromised. I would urge them not test the law making power of the people exercised through their duly elected representatives. The judiciary would be wrong to think otherwise.

Eighth, the court ruling is effective on 13 December 2011. The Court did not invalidate any decision of Parliament that took place on 9 December 2011. As such, the decisions taken by Parliament on 9 December are valid at law. The ruling to reinstate Sir Michael Somare as at 13 December 2011 is therefore a nullity and ineffective at law.

Ninth, also on 9 December 2011, parliament passed the Prime Minister and NEC (Amendment) Act. This law however was not certified by the Speaker until after the ruling of the Court on Monday 12 December 2011. Laws come into force on certification by the Speaker of Parliament (Section 110 of the Constitution).

This law has the effect of stating that a Prime Minister who is absent from Papua New Guinea (not Parliament) for a period of more than three months ceases to hold office as the Prime Minister and created the occasion under Section 142(2) of the Constitution for the election of a Prime Minister.

The question now is when was the position of Prime Minister vacant? Did it become vacant on 9 December or on the certification of this law on the 12 of December? In view of what I have said above, it would be correct to conclude that the position became vacant by operation of law on 9 December 2011 before the certification of this law.

This law did not create the vacancy in the office of the Prime Minister. It was the decision in parliament to rescind leave of absence in May sittings granted to Sir Michael that has the effect of making the East Sepik Regional seat in parliament vacant. Because the position of the Prime Minister was occupied by the Member of Parliament for East Sepik Regional seat and the seat had become vacant by operation of law through the decision of parliament, the office of the Prime Minister also became vacant by operation of law. Parliament then proceeded to elect a new Prime Minister at the earliest opportunity which was on 12 December 2011.

My view therefore is that Parliament did not require the operation of or the validity of the Prime Minister and NEC (Amendment) Act to firstly create a vacancy and secondly to validate the election of the Mr O’Neill as the new Prime Minister.

What then is the utility of this legislation? I would say that this new legislation is there to guide future conduct of Prime Ministers of this nation so that they do not absent themselves from the country for more than three months at any one time.

Tenth, given such new sets of facts, especially the decision taken by parliament on 9 December 2011, it became extremely important that the lawyers in the Supreme Court Reference should have asked the court to vacate the handing down of its ruling on Monday 12 December 2011 as the questions before the court had become moot by Friday 9 December 2011. The lawyers having failed to do so have contributed to the raising of tensions between the judiciary and parliament which should not have occurred.

I conclude that the a vacancy in the office of the Prime Minister was created by operation of law following the decision taken by parliament on 9 December 2011 to rescind its grant of leave of absence to Sir Michael Somare for the May sittings of parliament. This would appear to be the correct legal and constitutional position.

NOTE: The above article is written by Peter Donigi, a leading PNG constitutional lawyer and former diplomat.

It was reported on Saturday that O’Neill had managed to wrest power from Somare in the form of a coup, and that the crisis was essentially over. But reports from Port Moresby suggest the contrary – that Somare still claims legitimacy. It continues to be unclear how the stand-off can readily be resolved. So far violence has been avoided, but a continuing impasse could turn at any stage.

Constitutional lawyer and former Papua New Guinea resident Anthony Regan has been monitoring the political imbroglio as it has unfolded this week, corresponding with sources in Port Moresby. He explains below some key aspects of how such an unprecedented crisis came to pass for Australia’s closest neighbour.

How is it possible that the country now has parallel government structures – two prime ministers, cabinets, two governors-general, and police commissioners?

To understand how this situation has occurred, some background is required. Papua New Guinea national politics revolves round key personalities and patronage, with political parties of limited significance, and party ideologies and policies even less. Control of government is critical to dispensation of patronage. As a result, from independence in 1975, PNG saw high levels of instability in government, with members of Parliament often swapping sides. Constitutional limits on “party-hopping” were instituted in 2002, Michael Somare and his National Alliance Party (NA) being the main beneficiaries. Somare, in particular, was able to hold office as prime minister from 2002 until August 2011. Late in 2010, the PNG Supreme Court ruled key aspects of the limits unconstitutional. Always adroit, Somare clung to power, despite several moves to oust him.

In late March, an ailing 75 year old Somare went to Singapore for major heart surgery, leaving another MP, Sam Abal, as acting prime minister. Complications saw him remain there until September. His condition seemed grave, on 28th June his son Arthur (also an MP) announced a Somare family decision that his father had retired. It was, however, a decision about which the PM later said he had not been consulted. In any event, there was a high degree of uncertainty about how to deal with the situation. Moves were made to follow complex constitutionally mandated procedures to have Somare declared unable to be PM, on medical grounds, but the process was difficult.

On 2 August, leader of the opposition, Belden Namah, unexpectedly moved a motion in parliament to declare the PM’s office vacant. Despite the absence of a constitutional basis for such a step, the speaker allowed the motion. Some 48 members of the government voted in support of the opposition, including about half of Somare’s NA members. The then Minister for Finance and Treasury was elected PM. The move was attacked as unconstitutional by many observers, and challenged in a succession of court cases culminating in a Supreme Court decision handed down on 12 December.

The court’s decision declared unconstitutional both Somare’s removal as PM and Parliament’s decision to declare his seat empty, and ordered Somare’s restoration. On the same day, however, parliament passed an amendment to the Prime Minister and National Executive Council Act law retrospectively validating the acts of the Parliament in removing Somare as PM. There were 72 votes in favour.

Somare sought action from the governor-general to swear in his cabinet. After hesitation, the governor-general honoured the Supreme Court orders, and the swearing in occurred on 13 December. In response, parliament (O’Neill’s support there remaining solid) directed the governor-general to swear in O’Neill. When the governor-general failed to do so, the O’Neill Cabinet suspended him. Under the PNG constitution, suspension results in the speaker becoming acting governor-general. O’Neill was then sworn in again as PM by the acting governor-general.

Both Somare and O’Neill claim a constitutional basis for being PM, one under a Supreme Court order, the other under the December 12 Act of Parliament, a law which the Supreme Court has not yet considered. As each PM has appointed their own ministers, there are parallel cabinets. While Somare recognises the authority of the governor-general, O’Neill instead recognises the actinggovernor-general.

As for the two Police Commissioners, the O’Neill government had previously appointed Mr. Toami Kulunga to that office. When the constitutional crisis erupted on Monday 12 December, Mr. Fred Yakasa, a senior officer reported to be disgruntled with his being appointed police commander in Bougainville, emerged as head of a police unit apparently supporting Somare. On 13 December, Somare announced that Kulunga had been dismissed from office and replaced by Yakasa.

Who are the key players?

Peter O’Neill, 46, is leader of the People’s National Congress Party. His surname is that of his Australian father, while his mother is from Southern Highlands in PNG. An accountant, with a background in real estate and management, he represents a seat in the Southern Highlands Province, being first elected in 2002.

Grand Chief Sir Michael Somare, 75, entered the colonial legislature in 1968, with a background in teaching and radio journalism. Representing an East Sepik seat, he headed the first “indigenous” government pre-independence (1972-75) and was then prime minister from 1975-80, 1982-85, and 2002-11.

Sir Michael Ogio was MP for North Bougainville when appointed governor-general in January 2011 through a vote of the PNG parliament (the formal appointment being made by the Queen, as head of state, acting on and in accordance with the decision of the parliament).

Jeffery Nape was first elected speaker of the PNG Parliament in 2004. Far from being impartial, he had a record of highly partisan rulings that helped the Somare government retain power. In entertaining the motion to declare the PM’s seat vacant in August 2002, Nape caught the acting PM, Sam Abal, by surprise.

What are their claims to legitimacy?

Somare not only claims legitimacy under the Supreme Court decision ruling his removal from office as unconstitutional, and directing his restoration as PM, but also claims to be supporting and restoring the constitutional order disrupted by the unconstitutional acts that saw O’Neill become PM.

By contrast, O’Neill relies on two main arguments. The first concerns the December 12 amendment to the Prime Minister and National Executive Council Act, which was not considered by the Supreme Court in making its ruling of the same day. Under the PNG Constitution, legislation is valid unless ruled unconstitutional by the Supreme Court. He argues that in the absence of such a ruling, the legislation should be followed, and he should hold office. His second argument involves a principle of ‘parliamentary supremacy’, to the effect that the PM should be the person supported by the majority of MPs.

In relation to O’Neill’s arguments, however, two significant points arise. First, with over 70 MPs currently supporting him, O’Neill can argue that Somare would face grave practical difficulties in governing. However, Somare could answer that argument by saying that once in office, PNG experience would suggest that his level of support may well rise. Second, there would be a strong possibility that a Supreme Court challenge would see the amending law ruled unconstitutional, for example on the basis that it indirectly amends the constitutional requirements for appointment and removal of the PM, without any constitutional basis for doing so.

How does the PNG Constitution allow such a situation to occur?

The PNG Constitution is one of the longest and most detailed in the world, in its detail seeking to avoid problems that sometimes arise in Westminster and other parliamentary systems. The situation here has not arisen because of inherent faults in the constitution. Rather, the problem lies in the intensity of competition for office in the PNG political and constitutional systems, and because the decision on resolving the competing claims for constitutional legitimacy between Somare and O’Neill was made by the wrong authority, one not empowered or equipped to make such a decision.

In effect, the governor-general was called upon to resolve the conflict. But as a ceremonial office, with none of the “reserve powers” of, say, the Australian Governor-General, he was ill-prepared for such a role. In a situation where O’Neill’s primary claim to constitutional legitimacy rests on the validity of the amending Act of 12th December, it should have been the Supreme Court that ruled on that issue. In doing so, the Court could also rule on his claims about the principle of parliamentary supremacy in relation to appointment of the PM. By making a decision to recognise Somare, without resolving the alternative claim to legitimacy, the impasse has intensified. Unfortunately, the intensity may become so great that not even a constitutional ruling of the kind suggested will be acceptable as a way of resolving it.

The stand-off has remained nonviolent, can this continue?

The impasse is causing serious tensions not only within and between government institutions, but also in PNG society. There have been previous grave crises in PNG that have caused similar difficulties. In general they have been resolved without significant violence. In particular, the security forces (police and army) have generally exercised restraint. Further, while there have sometimes been popular demonstrations, the limited violence arising from them has mostly involved opportunistic elements damaging and stealing from retail stores.

It is difficult to say whether or not the current tensions will escalate into violence. There have been shots fired by police outside the governor-general’s residence on Monday 12th, though no one was hurt. While there are tensions within the police force, they have so far been contained. The Papua New Guinea Defence Force (the army) has been in lockdown so far, with senior officers indicating that in a situation of doubt about the location of ultimate civilian authority, the army must avoid becoming involved. In relation to community action, so far there have been just a few small demonstrations in favour of O’Neill.

On the other hand, the longer the situation remains unresolved, the more risk there may be of heightened tensions, and dangers of pressures building for action, either by security force elements or groups in society.

What should Australia’s role be in this conflict?

Australia has limited scope to play any significant role beyond offering wise counsel to key actors on all sides to take moderate positions. Foreign Minister Kevin Rudd has good relations with both Somare and O’Neill. The Australian High Commission in Port Moresby is in good communication with both of them, as well as with many of their key advisers and supporters. Through such links, Australia can have considerable influence.

Beyond such action, it must be remembered that there are also resentments in PNG about Australia’s role as colonial authority, and as an aid donor often critical of trends there. If Australia were to apply too much pressure, or act in ways seen as interference in domestic affairs, its ability to influence through wise counsel could be lost.

How do you see this ending?

It is difficult to see how the situation can readily be resolved, because both sides seem to be increasingly taking a “winner-takes-all” stance. Possibilities for compromise seem few. However, there are moderates and cool heads on both sides. There are ongoing contacts between some opposing individuals. The same is true of opposing groups in the police. There are also many influential figures and groups in “civil society” (churches, NGOs and others) that are voices for moderation. It is in large part because of such factors that PNG’s political and constitutional systems have previously demonstrated great resilience.

If the impasse cannot be resolved quickly, there would be possibilities of beneficial outcomes from more intense diplomatic efforts, perhaps involving a group of countries from the region.

NOTE: The above article was first published in The Conversation on December 17.

Anthony Regan, Fellow, State, Society & Governance in Melanesia Program, School of International, Political & Strategic Studies, Australian National University

Much is at stake in the Papua New Guinea crisis resulting from the 12th December 2011 Supreme Court decision holding that Parliament’s August 2nd removal of Michael Somare as PM was invalid.

Control of government in PNG brings access to wealth and power, and currently also involves control of resources critical to outcomes in the 2012 national elections. For those supporting Somare, his grave health problems mean this may be their last chance to gain power. For the PNG population the stakes are higher, the confrontation having potential to destroy the constitutional system.

Most reports emphasise the Supreme Court decision that Somare’s removal from office was unconstitutional. That view seems to have swayed the Governor-General (G-G) who on the morning of 14th December recognised Somare as PM by swearing in his Cabinet.

These developments overlook arguments for O’Neil’s right to be PM. On Monday 12 December, Parliament passed retrospective amendments to PNG’s Prime Minister and National Executive Council Act, aiming to remedy the defects in Parliament’s August appointment of O’Neil as PM. Under the PNG Constitution, Parliament is supreme, subject always to the Constitution. The amending law changed the situation ruled upon by the Supreme Court.

The G-G should not have been called upon to resolve the situation, for under the PNG Constitution that office has no reserve powers. Rather, it must always act on advice and in accordance with the advice of some other authority. That authority when appointing a PM is the Parliament. Where Parliament has legislated to remedy the defect that the Court ruled upon, it is likely the G-G should have acted in accordance with Parliament’s decision.

There are grounds for challenging the constitutional validity of Monday’s legislation. But decisions on such matters should be left to the Supreme Court, not to the G-G. Ideally, Somare should have sought to resolve the situation by asking the Supreme Court to declare the legislation invalid.

The danger now is that both sides not only have much at stake but believe they have a constitutionally valid right to power – Somare with Supreme Court support, and O’Neil with a solid majority in Parliament. It will be difficult for either side to back down.

The PNG Supreme Court has long stood out as the most respected independent institution, its rulings on constitutional crises being accepted by all sides. A worrying aspect of the current crisis is the extent to which the Court has become mired in the controversy, so much so that its ability to contribute to resolution of the evolving situation may have been compromised. If so, that would be a development with grave long term implications.

Otherwise, the most dangerous aspect of the situation is the politicisation and division in the Police, with significant factions supporting both camps. Not only are the risks of violence dramatically increased, but dangerous precedents are being established.

But the PNG constitutional and political systems have always been more resilient than most outsiders expect. People of goodwill from within political factions, from the churches, and from NGOs tend to emerge encouraging reason. With so much at stake for the two main groups in this case, the task of moderating influences will be especially difficult. Outcomes remain unpredictable.

Dr Ron May, Emeritus Fellow, State, Society & Governance in Melanesia Program, School of International, Political & Strategic Studies, Australian National University

What we have now is a rather worrying situation, one might have expected that with the supreme court decision Somare would resume the prime ministership, [but] there would still be a problem there in so far as the vote for O’Neill clearly demonstrated that the support was with O’Neill, Somare’s own National Alliance Party is split down the middle. So if Somare was returned as Prime Minister it would be with a minority government and not long to go before an election.

What has happened, of course, is that the parliament has passed some retrospective legislation which purports to remove Somare from his provincial seat, and I gather that is a legal provision, the lawyers tell me that that is a constitutional move and that the Governor-General is bound to accept that, but it’s clearly a pretty nasty way of getting rid of Somare.

With O’Neill and Somare both there, I don’t see either of them standing down very quickly… And with the challenge to O’Neil a lot of his support comes from the highlanders in Port Moresby, and we know that highlanders tend to be volatile when it comes to political competition. So I think we have got to worry about the potential for riots spreading; there’s already been some disturbances in some of the provincial capitals.

What’s going to happen? It’s hard to say but the most optimistic scenario at this stage is the possibility that O’Neill and Somare and their supporters realise that they do have a stand-off here and negotiate some sort of working arrangement. That would enable the two to collaborate in the few months that are remaining before the election, get through what legislation is necessary to be got through like the Budget which has been postponed. Somare and O’Neill have worked together before in the past so it’s not out of the range of possibility but at the moment it doesn’t look very likely.

Dr Ray Anere, Senior Research Fellow and Acting Pillar Leader, National Research Institute of Papua New Guinea

The Governor-General is the person who would have to make a decision [about the office of Prime Minister] in light of advice he would receive, and in this case the advice would have to come not just from legal sources but from the National Executive Council (NEC) and the parliament. The judiciary cannot advise the Governor-General on [who should be Prime minister]. The Governor-General would have to take its advice from either the parliament or the office of speaker, or the NEC, all of which are controlled by the O’Neil government.

At the moment the idea of grand coalition has not surfaced as an alternative arrangement, largely because the O’Neil government believes they have the numbers, and they have followed the due process of law.

And I think what they base … their argument on is that before the Supreme Court had made its ruling, parliament had made amendments to the Act of Prime Minister and NEC to allow for a vacancy to be created, and then proceeded to vote in favour of Peter O’Neill.

So the O’Neill camp at the moment has not shown any signs of wanting to enter into a coalition arrangement with the Somari camp. The Governor-General, based on the advice he receives, could dissolve parliament and appoint a caretaker cabinet but that at the moment is a suggestion only.

Political tensions are high, particularly between the two groups, between the Somare and O’Neil camps, and there was very high tension at the Government House yesterday. But the public in Port Moresby has remained calm and orderly, there have been no disturbances or violence or protest on the streets in Port Moresby.

There’s been a protest march up in … in the Eastern Highlands province, but that did not have any serious implications as far as law and order problems in Port Moresby. So the tension between the two political camps has not spilled over into the streets or the wider public in Port Moresby. So the streets generally remain calm here in Port Moresby and we hope that the tension will be resolved amicably.

Courtesy of what will go down in history as being the most perplexing and unprecedented developments in any Constitutional crisis in the Commonwealth to date, the ongoing dispute between Sir Michael Somare and Hon. Peter O’Neill as to whom is the legitimate Prime Minister, has helped put PNG on the Twitter map.

Over the course of what is now Day 4 of the Constitutional Crisis, I have been following and reporting on the developments on my Twitter Feed. The complexities of the context of how PNG has found itself with two Governors-General, two Prime Ministers, two Cabinets, two Police Commissioners and two Finance Secretaries are difficult to explain via Twitter.

If you add to the brew that the Supreme Court ruling, the powers of the Governor General, Parliament’s response to these interactions, and the different interpretations of the events by each of us, the situation is quite difficult to explain via Twitter.

I had one such conversation with one of my Tweeps, Matt Andrews:

Below is an excerpt from his website:

World leaders in Their Underpants is the directory aspiring politicians cannot afford to be without; a handy compendium of heads of state, unguarded in their undergarments. Far from being a childish work of lurid spectacle, it’s a revealing study of the relationship between power and vulnerability in the 21st Century.

From G8 leaders, parading around snug in the security of their tighty-whities, to less well known power-holders from some of the globe’s smallest nations, stepping forward timidly in their uncertain briefs. Pompous monarchs, barmy tyrants, humble elected statesmen and women of every hue, all lovingly illustrated in full colour by Nick Hilditch.

The national bird of Papua New Guinea is the Raggiana Bird-of-paradise, seen here adorning the arm of prime minister Peter O’Neill, who is, of course, in is underpants. O’Neill’s first act as prime minister was to establish a new national holiday, named Repentance Day. Many Papua New Guineans expressed confusion over the exact purpose of the day, as on the one hand, it’s a day off work, on the other it must be spent expressing sincere regret.

Confusion is commonplace in Papua New Guinea, a nation occupying half of the world’s second largest island, alongside Indonesia. It plays host to over 700 native tongues, but with a population just short of 7 million, that leaves over 6.8 million natives with no tongue at all. Presumably they communicate by sharing tongues, a tiresome activity, with a single day off a year on which to regret this sorry set of circumstances.

Former businessman, Peter O’Neill now joins World Leaders in Their Underpants where his many fellow heads of state will be keen to meet his splendid feathery mascot:

I’m not sure about the blue underpants though – I thought a dash of red and black would have been quite nice? Despite this, I think our PM looks much more forthcoming than the former President of Fiji, Brigadier-General Ratu Epeli Nailatikau:

Even Hilditch’s impression of the good old Ratu beats that of the Prime Minister of Australia:

To view a complete map of locations of World Leaders in Their Underpants click on the link provided.

Mr. Widjajono Partowidagdo, Indonesia’s Deputy Minister for Energy and Mineral Resources, voiced his concern after satellite photos showed that Papua Province had huge oil and gas reserves – and that very little progress had been made over the past 22 years to develop the area due to various constraints.

He went on to say:

“Moreover, there are [oil and gas] blocks located on the border area with Papua New Guinea. That country started production activities in blocks located on the border area long ago. If we don’t move fast, our oil reserves can be absorbed intentionally or unintentionally by them.”

The largest of these oil and gas blocks spread across both sides of the border is the Warim PSC which covers about 9,480 square miles (on the Indonesian side). The Warim PSC was signed in May 1987, and is owned by US-based ConocoPhillips (80%) and Santos (20%). ConocoPhillips is the Operator of the block but has been restricted in developing the area due to the Indonesian Government declaring the area a protected forest reserve in 1989 – a roadblock which will be adjusted in the nearby future.

What’s interesting for Indonesia and PNG is that there are corporates who currently have commercial interests on both sides of the border. For example, Santos has non-operating interests in PNG – these include the PNG LNG Project (17.7%) and Hides field, and oil production from SE Gobe.  Santos also has operated interests in the undeveloped Barikewa gas field.

Accusations and examples of neighboring states stealing each others resources aren’t new. Saddam Hussein’s decision to attack Kuwait was based on the premise that Kuwait was stealing Iraqi oil through slant drilling. Resource conflicts have dominated much of Africa’s recent past history; and more recently, the South Ossetia War has once again highlighted the high demand the world holds oil and gas in, and the extent nations will go to in order to protect their interests.

The Indonesian Deputy Minister’s observation is one worth taking note of – and one which PNG’s recently appointed Ambassador to Indonesia, Commodore  Peter Ilau, should be wary of.

Air Niugini is a company which has had its fair share of highs and lows. In 2002, Air Niugini was on the brink of insolvency and a Government guarantee was required to support the company’s borrowing from the Bank of South Pacific. The government also restructured the Air Niugini Board and senior management in an attempt to improve the airline’s core business – a strategy which worked and resulted in PNG’s national airline returning a profit of US$15.8 million in 2003.

Since the implementation of the reforms, Air Niugini has done well. The airline recorded a profit of US$12.2 million in 2004; and more recently posted a $US24 million profit for 2009. In amongst this solid organic growth, the company has reduced its debt burden, undergone internal restructuring, recognized pay-equity issues, procured new aircraft and developed new routes and code-sharing agreements.

However, despite all of this, the airline still  receives severe criticism from the public regarding the continuous increase in its airfares, particularly surrounding its domestic routes. There are two contributing factors to this annual public outcry: 1) a lack of understanding by consumers regarding the macroeconomic drivers of airline costs, more specifically – the only cost consumers really care about, i.e. ticket prices; and 2) an ambiguous pricing strategy which is neither transparent or communicated well enough to allow consumers to understand Air Niugini’s decisions in the first instance.

For example, if you were to book a one-way flight from Port Moresby to Rabaul today, it would cost you a total  amount  of  K507.30 (made up of a base fare worth K303.00, plus K204.30 worth of taxes). The following  tax breakdown is provided by Air Niugini:

The obvious question here is what exactly are the two surcharges (circled) listed in the tax breakdown for? Air Niugini attempts to explain what taxes, levies or surcharges are applicable to fares by offering this explanation under its FAQ section:

“Fuel and insurance surcharges, airport and government costs are included in the advertised base fare price. Applicable costs payable to third parties, such as airports and governments are still shown separately during the online booking process when you choose your flights.”

Satisfied? Not exactly. If you really want to know what the two listed surcharges are for, a bit of research will yield some results. Earlier this year, Air Niugini CEO Wasantha Kumarasiri fronted up to media after international fuel prices increased by 13.6% in eight months. As a result of the increases in fuel costs, Mr. Kumarasiri said the new fuel surcharge for all domestic routes will be K125.00 per person per flight, which represented an increase of K10.00 for each domestic route, except for Rabaul and Lihir which already existed at that level. Presumably, the K15.00 surcharge is an insurance cost built into the fare.

Taking all this into account, some questions still exist. If the Air Niugini tax breakdown (K204.30) illustrated above is composed of applicable costs payable to third parties (e.g. airports and governments), what exactly is the makeup of the base fare (K303.00)? It certainly should not include the fuel and insurance surcharges as these are included in the tax component of Air Niugini fares – although Air Niugini’s FAQ explanation states that base fares are inclusive of “fuel and insurance surcharges, airport and government costs”.

Air Niugini’s explanation seems to state that consumers are paying two lots of fuel and insurance surcharges, and a number of unidentified airport and government costs! What is going on? Surely it isn’t that challenging to describe what  costs contribute to a ticket fare in PNG.

From a business perspective it makes sense to mitigate risks to your organization. Air Niugini is a state-owned enterprise, and one of its biggest challenges in PNG’s aviation sector is the accountability-factor which accompanies its ownership structure. The perception that Air Niugini can not justify its increasing airfares, whether right or wrong, is damaging the reputation of the airline. The least the company can do is to educate consumers as to what exactly constitutes a ticket fare in PNG – and the first step management should consider is a clear and precise pricing strategy which is communicated well to the consumers and owners of Air Niugini, the people of Papua New Guinea.

[UPDATE: Five days after T&D wrote this post, Air Niugini's CEO Wasantha Kumarasiri announced another increase in Air Niugini fees. Air Niugini's tax breakdown remains the same.]

Not since the formalising of our Constitution has there been as much public affectation or political hysteria concerned with the launching of a Government white paper than that we witnessed with the christening of Papua New Guinea Vision 2050.

Following its completion in late 2009, PNG Prime Minister Sir Michael Somare declared:

“PNG Vision 2050 is a beacon of fresh hope for our people and future generations. The plan maps out the future direction our country should take, reflecting the hopes and aspirations of our people“.

I have cautiously harboured my own personal views on the topic over the past 11 months, but as PNG Vision 2050 (PNGV50) nears its first birthday, the Government’s self-proclaimed “gift to the people” deserves to be scrutinised – particularly as these teething years are absolutely critical to the success, or failure, of the PNG-born and bred national plan.

To state that PNGV50 is ambitious is an understatement. The cynic would claim that it is an overly prodigious attempt to capture the elusive PNG tradewinds that provide comfort to so many of our citizens on a hot day. Despite the rhetorical applause awarded to the document from central government and its learned authors, the document has come under severe  criticism from a few pockets of resistant nonpartisans. Admittedly, I suspect my own personal opinion of the document, from an holistic perspective, would weigh the scales in favour of the ‘Nays’.

As I suggest in the title, PNGV50 is a kuka (crab) strategy, i.e, it sets the stage for moving forward to some extent, and then stalls and moves sideways instead. In other words, PNGV50 is largely an horizontal and qualitative approach to making PNG a “smart, wise, fair and happy society by 2050“.

Where is the quantitative framework that will provide tangible go-forward in a realistic and timely manner? One year on sees a below par performance from central government and line agencies supporting and proactively facilitating the development framework of PNGV50. In fact, to date, the National Health Plan 2011-2020 is the only sector plan to be aligned with the PNGV50 and the Development Strategy Plan (DSP) 2010-2030.

Technically, PNGV50 is not a strategic plan in any sense of the phrase. Of its 51 pages of text, only 10 are truly strategic and it is these 10 pages that should  form the entirety of PNGV50. Consequently, these 10 pages should be dissected and extrapolated into a relevant medium term planning guide for all sector plans up until 2050.

In addition, its status as being visionary has been questioned. Kindi Dolle Mewa recently wrote an opinion piece to The National concerning PNGV50. He states:

“The Vision 2050 does not seem to be a visionary document that inspires creativity in development but rather attempts to do the opposite. The true visionary document has already been clearly written by the founding fathers of this nation in the Constitution.

There is no need for the Prime Minister to give another ‘gift’ to the nation because he has already given one that captured his wisdom. We only need strong commitment to make the five directive principles and goals of the Constitution a reality. The Vision 2050’s so-called Seven Pillars are perceived under static lens and have no consideration for the dynamic and evolving stages of development“.

Mewa makes a valid point. PNGV50 is not a visionionary document but a static planning document because it does not take into account the dynamic global and local political, economical, social and technological environments.

Indeed, the biggest issue I have with PNGV50 is the copius number of assumptions that have been weakly threaded together in an attempt to provide a logical and systematic approach in achieving the document’s objectives. These same assumptions are simultaneously utilised to confidently identify specific challenges that the country faces and consequently should address. In some cases, PNGV50 literally describes challenges within challenges!

One aspect of PNGV50 that really concerns me is the entrenchment of the document into legislation. In an interview with Radio Australia, Daniel Kapi, the deputy Chairman of PNGV50, stated:

“One of the things that we are doing now is this plan will now be anchored in law, so that it has a legal footing. So we are making amendments to the Prime Minister and N.E.C. acts which will legally be part of their program, which will empower them to push this plan forward.

So now under law, its ownership will be taken over by the Department of Prime Minister and N.E.C. so at least you know that the driver becomes the Prime Minister himself and the executing agency becomes the Department of Prime Minister. That is the first step.“.

PNGV50 openly acknowledges that in order for the documents’ objectives to be acheived, the driving force of success must be the full participation of our people and a complete change in their mind-sets. If one wants somebody to be inspired, empowered and to be truly creative, that individual must take voluntary ownership of being an agent of change and actually believe in the cause.

It is extremely ironic, and more appropriately hypocritical, that PNGV50 admirably and passionately seeks to create this change, and yet simultaneously, demonstrates a brutal vote of no confidence in the ability of our people to voluntarily become these very same agents of change by enacting legislation.

What a stinging slap to the face.

The National Strategic Plan Taskforce and PNGV50 have got this national plan backward. This kuka strategy describes ‘What’ it wants, ‘How’ it wants it and in last place, ‘Why’ it wants it. In order to be truly effective, PNGV50 needs to reverse its approach by first convincing Papua New Guineans ‘Why’ they should take up the mantle of change. The ‘How’ and ‘What’ will easily follow – for it is only when our people truly believe in the cause of changing PNG that we will become a “smart, wise, fair and happy society by 2050” – and no amount of new legislation will change that.

]]> http://garamut.wordpress.com/2010/09/07/png-vision-2050-a-kuka-strategy-one-step-forward-three-steps-sideways/feed/ 4 Tavurvur From Independence to PNG Vision 2050 - A 75 Year Journey PNG Vision 2050: Will it Guide PNG Forward? http://garamut.wordpress.com/2010/09/04/deja-vu-png-the-bulolo-phenomenon-all-over-again/ http://garamut.wordpress.com/2010/09/04/deja-vu-png-the-bulolo-phenomenon-all-over-again/#comments Sat, 04 Sep 2010 20:22:02 +0000 Tavurvur http://garamut.wordpress.com/?p=2971 ]]>

I was recently reading a number of Wall Street investment analysis reports  covering emerging markets within the Asia-Pacific, and as expected, Papua New Guinea’s economic profile popped up. The opening sentence of PNG’s economic profile was the first and last line I read in this particular brief. This introductory sentence follows:

“Papua New Guinea is richly endowed with natural resources, but exploitation has been hampered by rugged terrain and the high cost of developing infrastructure and facilities“.

This opening line designed to inform potential global investors about the Land of the Unexpected bothered me to such an extent that I completely discarded reading the report for a few days. Why? Because the structure and context of the language used in this particular sentence is largely representative of how the corporate world views PNG. There is no subtle hint or Chinese-qianzai in relaying this purpose or reason for action as described in the sentence. It is stated unashamedly, crudely and matter-of-factly, i.e., “exploitation“.

One country that has had more than its fair share of PNG is Australia. The potential of our resources has long been identified by Australia with the Wau and Bulolo goldfields the first major incursions into exploiting PNG’s mineral wealth. The Bulolo phenomenon in the 1930s, which saw thousands of kilograms of  PNG gold contribute to the development of Sydney and Brisbane, set the precedent for capitalised monolithic corporations to focus their largely then inefficient energies on PNG. Seventy years on their progeny have evolved into leaders in the fields of technology and innovation, enabling them to overcome many of the geographical limitations that plagued early pioneers.

Just like the Bulolo gold fields, the PNG LNG project has once again attracted the attention of the globe. And once again, Australian cities are in line to reap rewards. One, in particular, has caught the eye due to its geographic location, economic dearth and particularly, its agressive strategic approach to taking advantage of PNG’s mineral wealth. That city is Cairns.

Since 2009 the Cairns Chamber of Commerce and Advance Cairns, the regional business incubator and development organisation, with the support of Queenslands’ Bligh Government, have set their sights on tapping into the economic opportunites PNG presents. Contributing to an agressive investment strategy has been regular high-level meetings between Cairns business delegations and PNG:

• November 10, 2009: Cairns Chamber PNG trade mission visits Port Moresby
• March 15, 2010: Queensland Treasurer Andrew Fraser leads 40 business representatives to PNG on a 3-day delegation
• November, 2010: A trade mission of Cairns business representatives will leave for PNG in November armed with The Cairns Prospectus

Such is the emphasis on PNG and the importance of converting opportunities into dollars that Queensland Treasurer Andrew Fraser recently launched The Cairns Prospectus,  a blueprint aimed at broadening out the Cairns economy and attacting investment, and which places special emphasis on PNG.

This commitment to deliver on an overarching PNG strategy for North Queensland to capitalise on opportunities in the market via a structured and coordinated manner has resulted in Jeremy Blockey, President of the Cairns Chamber of Commerce and Director of Advance Cairns, being appointed as the Queensland Government’s new Special Trade Representative to Papua New Guinea (PNG).

The Cairns-based Special Trade Representative to PNG is an initiative of the Queensland Government under the Cairns Economic Future Plan released in November 2009 which is tasked to create new jobs in Cairns and Far North Queensland. The Special Trade Representative will also be a member of the new Queensland-PNG Business Group to advise Trade and Investment Queensland on business relations with PNG.

The simple fact that PNG is beginning to be included as an integral part of the strategic direction of both local and federal government thinking is an encouraging sign for business confidence in the nation. There is no doubt that Cairns and North Queensland are placing a particular emphasis on PNG in the hope of boosting the regions’ stagnating economy.

However, it is this same desperation in the wake of opportunity that we must be attentive to – the Bulolo phenomenon has showed us quite clearly what can happen if we aren’t.

]]> http://garamut.wordpress.com/2010/09/04/deja-vu-png-the-bulolo-phenomenon-all-over-again/feed/ 2 Tavurvur The Cairns Prospectus - Exploiting PNG's Opportunities Jeremy Blockey - Tasked with leading Queensland into PNG http://garamut.wordpress.com/2010/06/22/pacific-support-for-west-papua-grows-but-where-is-png/ http://garamut.wordpress.com/2010/06/22/pacific-support-for-west-papua-grows-but-where-is-png/#comments Tue, 22 Jun 2010 07:40:26 +0000 Tavurvur http://garamut.wordpress.com/?p=2901 ]]>

In what can only be described as an extraordinary move, a Motion on foreign policy regarding West Papua was passed in the Vanuatu Parliament on June 19th.

During the sitting of Parliament, Vanuatu Prime Minister Hon. Edward Natapei, and the leader of the Opposition Hon. Maxime Carlot Korman jointly sponsored a Motion in Parliament to declare Vanuatu’s foreign policy regarding West Papua. This unprecedented move was initiated by a tabled petition on behalf of the people of Vanuatu calling for a transparent foreign policy on West Papua.

The following proposals from the petition could become significant clauses of the Bill – if accepted:

1. Sponsor and pass a motion in national Parliament officially declaring that Vanuatu’s foreign policy is to support the achievement of the independence of West Papua;

2. Sponsor a resolution at the 2010 Melanesian Spearhead Group’s (MSG) Leaders’ Summit that the independence movement in West Papua be given Observer Status at the MSG;

3. Sponsor a resolution at the 2010 Pacific Island Forum Leaders Summit that the independence movement in West Papua be given Observer Status at the Forum;

4. Sponsor resolutions to the Melanesian Spearhead Group’s Leaders Summit, the Pacific Islands Forum Leaders Summit and the United Nations calling for fact-finding missions be sent by each of these bodies to West Papua to investigate alleged violations of the human rights of it’s Melanesian populations;

5. Become the official state sponsor of the case of West Papua in the International Court of Justice seeking a judgment on the legality of the 1969 “Act of Free Choice”;

6. Sponsor a resolution in the United Nations to put West Papua back on the United Nations’ list of Non-Self-Governing Territories;

7. Create a West Papua Desk in the Department of Foreign Affairs with a budget sufficient to facilitate the Government’s international advocacy efforts in support of West Papua’s independence;

8. Ratify the United Nations Convention Relating to the Status of Refugees, to provide Vanuatu with an avenue for additional support to the people of West Papua.

Let us not depreciate the real significance of this milestone. For the first time in the Pacific, and for that matter the world, a sovereign nation has voted unanimously in its legislative assembly to support West Papua. This is the first crack in the dam of international passivity – and just like Taiwan has managed to build nation-state support for recognition under the shadow of mainland China, so too now officially begins West Papua’s campaign.

In responding to the bipartisan support for the Motion, Prime Minister Natapei promised that he will sponsor the issue of West Papua to both MSG and PIF-meetings. Natapei will also proceed to apply for West Papua to be relisted with the UN Decolonisation Committee in order for the Territory to be given the due process of decolonisation. Vanuatu – please take a bow!

Now – one question I want to poise is this: where is PNG on the issue of West Papua? Somare has made it clear that he wants PNG to play a greater role in the Pacific, in particular regards to development aid and assistance packages. Adopting such a soft strategy is acceptable in terms of gradual regional influence, but do we really want to become the Melanesian “Big Brother” in the same mold of foreign policy that both Australia and New Zealand patronise?

I would argue that it is on such an issue as West Papua where the  real opportunity exists for PNG to achieve robust recognition as a major player in the region. And in the Pacific, opportunities such as these are as scarce as hen’s teeth. Of course, becoming influential should not and never will be the reason as to why PNG would support the freedom of West Papua. This decision should be based on the irrefutable foundation of natural justice and the rule of law – and the committment of our own government and people to proactively address this issue.

Somare’s lack of movement on West Papua since Independence and the follow-on through of that same benign policy over the years by consecutive governments is a reflection of the immaturity of PNG. Indeed, it could quite possibly be that we lack the capacity to deal with what would be a sensitive affair on our very own doorstep. This is an argument that I do understand.

However, there is no doubt in my mind that PNG is the rubicon of this offensive – in other words, if PNG commits – there is no going back and the rest will follow. I believe the day we actually make a stand on the issue as a country and not keep practicing the art of tolerant excuses will be the day we have achieved a mature nation-state prepared to take our place in the  context of a global community.

No doubt some of our Melanesian neighbours and international observers are contemplating rehearsing Kevin Conrad’s prevailing words to PNG:

“There’s an old saying, if you’re not willing to lead then get out of the way. And I would ask…(PNG)…, we ask for your leadership; we seek your leadership; but if for some reason you are not willing to lead, leave it to the rest of us. Please, get out of the way.”