Mining does not bring real development for PNG people

By Patrick Talu

Audited payments made by Porgera Gold Mine to the Government and various stakeholders can be tracked, but not after they had reached the Government.

There remains a critical lack of transparency at both the National and sub-national government levels where the impacted communities who are supposed to be the ultimate beneficiaries of PNG’s mining and mineral wealth are let out.

Peter Johnson, former Economics Studies Program Team Leader and Senior Research Fellow with National Research Institute said: “Observing the details of how much of the revenues from the mining project that are spent are difficult if not impossible to access.”

He was speaking at the launch of a case study yesterday at NRI titled, Lode Shedding: A case study of the Economics Benefits to the Landowners, the Provincial Government, and the State from the Porgera Gold.

Mr Johnson said it was easy to track funds coming from the mine and going into the National and the provincial Government but how and where it ended up from the provincial government to the local level government and the development authorities in this case, the Enga Provincial Government (EPG), Porgera Development Authority) PDA) and Porgera Local Level Government (LLG) respectively were untraceable.

The report has indicated that to date over a billion kina in cash and benefits have gone out of Porgera mine yet not being translated to real developments.

He said the amount of funds held in trust accounts was more difficult to estimate as well as investment made by Kupiane Investments. This, he said, was even more difficult to trace except for an initial endowment of K9 million in 1997 while the study could not find information on the current state of the benefits or how those payment were distributed.

The reports indicated that from the start of the mine in 1990 till 2009, the National Government received over K3.4 billion in income tax, company tax, customs, fuel levy, business contracts, education and other measures.

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8 Comments

Filed under Corruption, Financial returns, Human rights, Papua New Guinea

8 responses to “Mining does not bring real development for PNG people

  1. The title of this article is misleading. I can’t remember which daily ran this story, but they should really exercise some professionalism.

    There is no doubt that within PNG, mining does bring real development to the people of PNG, but it primarily does so indirectly.

    A better way to look at this may be to rephrase the above statement by saying that mining brings money to the national government which then passes this on down to provincial governments, who then, theoretically, pass it down to local level governments – for the purposes of development.

    The problem highlighted in this article is that this distribution of mining-income (i.e money), is not being pipelined down to the actual people of the project areas.

    Where has all this money gone? It is not the fault of the mining company, it is primarily the fault of local government, provincial government and the national government in regulating the two.

    Stricter measures need to be introduced, and sharper penalties imposed by the national government, on those provinces and local level governments that screw around with mining-income.

    This is simply not good enough.

  2. Huh?????

    No Patrick its not Mining that is not bringing benifits.
    It is your politicians corrupt mentality.
    With respect, you need to stop blaming the wrong people and accept responsibility for the Melanesian Way.
    It does NOT work.
    Either embrace a transparent system of governance of just forget it all!!!!

  3. Huh?????

    Tavurvur
    Spot on!

  4. Ken the Miner

    Tavurvur, you have got that right. Most politicians are not in power to represent the wishes of the people, they are there for their own sakes and that of their vested interests. Now they even control the judiciary. God help us!

  5. Have a read of this piece where I explore the defective partnership that is ExxonMobil, landowners and the State:

    http://garamut.wordpress.com/2012/03/28/exxonmobil-landowners-the-state-taking-a-closer-look-at-a-defective-partnership/

  6. j kross

    ‘Mining does not bring real development for PNG people.’ This statement is correct. And mining shouldn’t anyway. They pay taxes to governments and royalties to people and it is these recipients who should bring real development to people.

    It’s not the responsibility of mining to bring development. The sinister intent of this statement points back at whoever wrote this piece. Think again.

  7. Huh???

    Yes, more cargo cult brain dead comments from the hairy legged set.

  8. Huh???

    One thing is for sure, the left wing environmentalist set have never brought an iota of benifit or development to the peoples of PNG and the nation, NOT AN IOTA.
    OMG they are so stupid and blinded by theit selfrightousness.

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