Economic Independence is domestic ownership of wealth. Real economic independence will be seen and felt if the government has the capacity to provide for its own resource needs or own resources necessary for domestic development. This relates to political independence, because in order for the government to fully exercise its power as an independent body, it should discourage the ownership of resources by a few elites or foreigners, as it will function in their interest and reflect their will.
It is the citizens who should be supplying the needs of the state if we are to see our nation achieving full economic independence. According to Namorong,
“all Governments need resources to exercise their power. If the state owns and supplies its own resource needs, then the state promotes its own interests. If corporations supply the resource needs of the state, the state protects the interests of corporations. If citizens supply the resource needs of the state, the state protects the interests of its citizens.”
Government’s focus is all about mining, commercial fishing, commercial logging – big industry and less or even no attention is given to smallholder extension services or to the so-called informal sector. However, PNG’s economy is dependent on agriculture. At the same time, a majority of the population is dependent on agriculture. The National Informal Economy, given adequate government support, can provide economic independence for the nation, while creating broad and sustainable employment for citizens throughout the nation.. Recognition and strengthening the informal sector, rather than the formal sector (‘cash economy’) can be a breakthrough for PNG.
There’s big potential there because that’s what we are good at doing. We are productive people and it comes naturally in a sense that local people, even without any proper knowledge in agriculture, can produce something and sell. All we need is better transport network and general infrastructure to support the people. Policies should be people-friendly, producer-friendly. We already have the background, in the 2011 National Informal Economy Policy.
For our economy to be fully economically independent, we might also consider the importance of a developed manufacturing sector, in terms of downstreaming processing. PNG export approach is to ship our natural resources as raw materials: this is the central attraction for foreign investment and it’s going to remain that way unless our government takes a step forward on this sector of the economy. It is not necessary that we hand over our resources to foreigners in order to see progress. If it was, the founders of this nation would not have called for National Sovereignty and Self Reliance or for the wise use of natural resources.
Another important inducement for economic independence is being less dependent on foreign aid and foreigners to stimulate our economy. That includes foreign grants, aid and foreign investment. Our economy is greatly dependent on foreign investment: for example, almost all mining companies are foreign owned. This is not economic independence. Nor is accepting aid, dependence on which disempowers the government from fulfilling its duty to its citizens. A study made last year by the Australian Government’s Joint Intelligence Organization found almost two-thirds of PNG’s economy is controlled by Australian companies and individuals. And with the rapidly increasing Asian involvement in economic activity here, it is clear that we Papua New Guineans at present control only a very small part of our own economy, and will remain in this subservient position unless firm action is taken to change the existing situation in a meaningful way.
So I would say that this is the real independence struggle of Papua New Guinea. What economic independence really means to me is that our government owning the wealth of the nation and getting only its own citizens to supply its resource needs, not from any other third parties (as in foreigners). We should not be relying on foreign aid and investment to maintain our economy. Economic independence means people of the nation are in charge of generating cash, which stays in the domestic economy. Economic independence is the control of the wealth of a nation by a majority of its citizens. Because of this, developing the subsistence or informal sector in Papua New Guinea can really contribute to the overall independence of our economy. Improvements in road networks and basic infrastructure are the main motivational factors required for people to contribute to PNG’s economy, if they are not already doing so.