By Leonard Fong Roka
‘Never openly accept a kind gesture from a neighbour; scepticism is one’s stream of betterment for the long term benefit oriented or strategized visions and goals’
China is the only existing ancient civilisation in the world. It has the world’s largest population and the rapidly growing economy. All its political, economical and social influences are today fast shaping and streamlining the global systems and thoughts; regions and states and power networks in geopolitics.
Due to its locality in the Pacific, Oceania has being experiencing its impacts and Bougainville is no exception, China’s rise, is an attraction.
This paper, intends to look into the much debated Chinese investment on Bougainville from a micro-analytical level. Highlights shall come from Bougainville’s historical economic successes and the impacts of the Bougainville crisis. It also, should consider the great untapped economic potentials of the island and political changes that, I know attracts investors, in the long run.
Furthermore, it should provide the general view of Chinese investment trends in the world and the region. There are also, risks and benefits that ought to be discussed where Bougainville is concerned.
Bougainville is the largest and the resource rich island of the Solomon archipelago. From the 1960s it hosted one of the world’s largest open-pit mines with Panguna as said by BCL chairman, Peter Taylor (2011), “processed 50 million tonnes of ore per annum with a 20 year lifespan still existing before it was shut down” (pg 3)1 and of which, “the [PNG] national government received 20% of the profits and gave back to Bougainvilleans, a 0.5% share” adds on by Wikipedia2. According to the Australian documentary film, Bougainville, Our Island Our Fight, the island is made up of proposed mines yet to be tapped into. Beside also, Bougainville was the largest cocoa-copra producer for PNG. Scales, Craemer and Thappa (2008) wrote: “It produced from 1979-1989, an annual average of 15 600 tonnes of cocoa and an annual average range of 10 000-20 000 tonnes of copra” (pg 31)3.
These years of traceless fortune was rocked by the Bougainville conflict from 1988 when the islanders asked for a K10 billion compensation and political independence. Bougainville suffered an economic setback. It is a setback that shall take time and effort for Bougainville to retain its old status of power in the region but in direct contrast to the controversial terms of referendum dictates.
During the conflict, economically Bougainville was on stand-still. All infrastructure destroyed and economic activity death. But as the peace process began, economic activity took a slow pace parallel to the pacification process; all owned by Bougainvilleans, which is a positive step towards ‘true’ independence with an empowered Bougainville people.
This pace of economic come-back, though, poses doubts on the ‘bias and myopic’ terms of referendum that states, ‘…referendum be held: no earlier than 10 years and, in any case, no later than 15 years after the first election of the autonomous Bougainville Government [and ignorantly, based the terms on: (1) weapons disposal, and (2) good governance’ (“Agreed Terms of Referendum,” 2001)4.
To most Bougainvilleans, the Peace Process was bias or short sighted because the leaders upon signing it did not take into consideration the need to solve internal conflicts. These are questions such as, ‘If you remove a gun from a combatant then, what do you give back to complement him with?’
It by-passed an important aspect of the crisis, that is, the people were in a ‘post crisis’ environment and such solution must not be rushed but addressed the situation step-by-step in a manner that the cause of the conflict is address to the best interest of the people.
The leadership, rather focussed on the ‘fast tracking’ of self-determination and the general political settlement.
To this, the Autonomous Bougainville Government had being knocking on Chinese door for assistance to built its economy to a better position towards obvious nationhood or as a means of paving ‘full belly no conflict’ climate on the island.
With this note, though the island has now having a populace of ‘hungry bellies’ in the economic light. But, Bougainville has a potential economic capability in the Pacific region.
This is an attraction for any profit oriented or resource hungry foreign investor that its own backyard just can’t provide for.
In 2010, after taking office as president of Bougainville, Mr John Momis engaged the ABG into pursuing a strategy of getting Chinese investment onto Bougainville. To President John Momis’ words in Radio Australia (cited in Keith Jackson & Co: PNG ATTITUDE, 2011), “In response to that, the Chinese have been coming to Bougainville to look at a number of potential economic projects one of which is the proposal to set up a Special Economic Zone on the northern tip of Bougainville Island including eventually, I suppose, the building of the Buka Passage Bridge to connect Buka Island with Bougainville”5.
Thus, born was the proposed Bonus Special Economic Zone (SEZ) on the northern-most tip of the mainland, Bougainville.
Artist impression of Bonus SEZ (actnowpng.org)
So, what is a SPECIAL ECONOMIC ZONE? A special economic zone (SEZ), according to Wikipedia, is a geographical area that has economic and other laws that are more free-market-oriented than a country’s typical or national laws. “Nationwide” laws may be suspended inside a special economic zone6.
In regard to this, Chinese investors had continuously visited Bougainville led by agent Jason Fong to set out the frame work of the proposal.
The blog ACTNOW!, stated that ‘the SEZ would involve cocoa, estimated to net an annual revenue of K1.5 billion for Bougainville, and marketed mainly to China7’. The Post Courier Online further adds, that it will be ‘a sophisticated large urban area with a variety of modern city buildings including a trade centre, an overhead bridge linking Kokopau and Buka Island, a sport complex, a shopping mall, a six lane road and many more fountains and gardens and solar-panel thatched residential areas8’.
As it seems, Bougainville ought to be a developed region with a high standard of living for the people. All these would be attained with one single Chinese investment project on Northern Bougainville. Copra, mining and other known Bougainvillean resources are not mentioned, but only cocoa would change Bougainville, economically.
With this Chinese investment earning the said K1.5 billion per annum for the island of 175 160 (2000 census)9 people, there is high probability that the per capita income per head would be so high creating a consumer society in high demands of goods and services.
Such a single-handed agricultural development with sound leadership on the island, should be the foundation of other agricultural drives in such areas like rice farming, poultry and so on to leap making Bougainville self-reliant.
It is from a well established agricultural sector that we move into down-stream processing to add extra value to Bougainville exports so as to increase export earnings. According to ‘Rostovian take-off model’ of economic growth, economies need to depend on raw material exports to finance the industrial sector10. In this developmental strategy, there is a strong power-base that is, the agricultural sector.
A competitive agricultural sector paves a strong domestic Bougainville economy.
An economic miracle as it seems, however, Chinese strategies are much controversial across the globe. According to the blog, EASTASIAFORUM, Feigenbaum (2011, para.8) claims that Chinese strategies are hardly uniformed. Nor have they proved to be uniformly successful11. This shows that, even Chinese firms are not uniformed to their activities. Negative repercussions, thus ought to be planned for in Bougainville. And with Bonus, when the project is solely, Chinese, long term or short term benefits are also unpredictable since the local human resource sector is not fully developed and also, Bougainville is still trying to break free from the post-crisis stigma with difficulty, so recovery must be a ‘process’ and not a ‘miracle’ as the Bonus project is.
In summary, China is a determined power with experience and a population capable to dominate the world. Undeniably, the Pacific is its political, economical or social ‘floor-mat’ and so, it so challenges Taiwan and the west diplomatically for dominance.
Natural resources supply is what China sniffs the world for to sustain her industrialisation. Bougainville, which has a record mining and other natural resources thus, looks good for her. Entry into Bougainville is what China needs, then establish herself up into the other sectors.
Though, for are economically struggling Bougainville, China seems a positive partner, the great secrecy of Chinese investment strategies and outcomes makes the future much doubtful, without a firm or strong political system or government in place, Bougainville shall, repeat the Bougainville Copper Limited experience whereby, the people and the island get nothing in return but just the positive media portrayal.
So, thinking big, but starting small is the strategy suitable for Bougainville.
References
This I believe is being now directed towards Torokina Oil palm proposed projects as a impact strategy
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