For many years, Jubilee has questioned who the real beneficiaries of PNG's development model are: foreign mining and oil and gas companies, or its people? Meanwhile, other NGOs' have raised the same questions about the damaging impacts of unsustainable logging and oil palm sectors. In reality, these elements are two sides of the same coin: a development model based on large scale natural resource extraction, done in collaboration with and primarily for foreign corporations' benefit.
Our report ‘From Extraction to Inclusion’ co-published with ACT NOW! PNG and The Oakland Institute analyses PNG’s economic and development performance since its independence in 1975. The main finding is that the PNG economy has relied on the large-scale extraction of abundant minerals and other natural resources, under the illusion it will improve the lives of its citizens. Yet, on most indicators, PNG is faring worse than its Pacific neighbours and any progress that has been achieved does not reflect the huge value of the resources extracted.
AN EXTRACTIVE-BASED DEVELOPMENT PATH HAS FAILED TO IMPROVE PEOPLES’ LIVES FOR MANY REASON
FOREIGN COMPANIES BANK PROFIT OVERSEAS
The extractive industries tend to operate as enclaves with little connection to the rest of the economy. Foreign companies have externalised their enormous social and environmental costs while banking most of the profits offshore.
THE COMPANIES CONTRIBUTE LITTLE TO GOVERNMENT REVENUES
The companies contribute relatively little to government revenues. In 2018, 6.5% of the sales from the mining and petroleum sector went to government.
THE HEALTH AND EDUCATION SECTORS HAVE SUFFERED
The growth of these sectors has been accompanied by poor governance, theft of public money, and corruption, which all take much needed funding away from health and education services.
EXTRACTIVE INDUSTRIES CREATE VERY FEW JOBS
Around 90% of Papua New Guineans work in the informal economy (mostly growing and selling food crops). The mining, oil and gas sector only produces about 2.5% of jobs in the formal economy, which in turn is only 0.3% of the total workforce.
“From Extraction to Inclusion details the important policy shifts that the government needs to make to put people back at the centre of its economic and social development policies. These should start with a halt to the current attacks on customary land tenure, which is the basis of the village economy and the livelihood of most of the population”
- EDDIE TANAGO, CAMPAIGN MANAGER, ACT NOW! PNG.