Waiting for Godot: why PNG keeps waiting for mineral wealth that never arrives
Updated: 3 minutes ago
By Martyn Namorong
In November 2026, Papua New Guinea’s parliament will have its final say on the political future of Bougainville. Whilst Bougainville’s quest for self-determination has its roots prior to PNG’s independence in 1975, the matter came to head in 1988 when Panguna mine landowners demanded compensation for environmental damages.
Panguna was meant to bankroll the newly independent nation with the revenue and develop the economy. That promise turned out to be a disaster with a deadly civil war resulting in the deaths of 20,000 Bougainvilleans.
Did PNG learn any lessons from Bougainville?
It’s a mixed picture when examining whether PNG has learnt any lessons from PNG?
These can be categorized into political, environmental, social and economic lessons.
One of the most immediate political responses to the Bougainville Crisis was the abolishment of the post-independence provincial government system headed by provincial premiers. Weaker reformed provincial governments replaced them headed by governors. Up till today, Port Moresby continues to increase its grip on the nation through the creation of new statutory bodies that control various aspects of the state.
Although the Bougainville crisis highlighted problems with mining and its environmental and social impacts, this did not trigger any policy change in Port Moresby. In the 1990s, landowners impacted by the environmental pollution of the Ok Tedi copper mine sued BHP Billiton for environmental damages. The government of PNG had authorized the dumping of rock waste and tailings into the Ok Tedi river in the 1980s causing physical damage and chemical pollution of the riverine environment.
Despite one of the main grievances of Bougainvilleans being the destruction of the Jaba River by Panguna mine waste and tailings, the government of PNG continued to allow the dumping of similar wastes by Ok Tedi into the river. The practice of discharging mine wastes directly into the environment continues to this day including deep sea tailing disposal by Ramu Nickel and Lihir mines.
Resources projects continue to be sold as an answer to PNG’s economic challenges despite the spectacular failure of the Panguna mine and the failure of other resource projects to meet expectations.
What do the numbers say?
Despite mining and oil and gas sector dominating PNG’s economy with nearly 90 percent of its export earnings, very little benefit flows back to the country.
A 2018 blog published on the Australia National University Development Policy Blog found that since independence, the government of PNG has collected very little resource revenue compared to the value of exports. The authors found for instance that in 2017, the government of PNG received K400 million out of K25 billion worth of exports. Latest available data from the 2024 PNG Extractive Industries Transparency Initiative (PNGEITI) report total resource exports were worth K50.4 billion. Of this the government of PNG received K4.2 billion in taxes and dividends representing merely 8 percent of the total value of exports.
When the white man colonized PNG, they bought land with tobacco, mirrors and axes. Today, Papua New Guineans still sell their resources for peanuts. Grass skirts may have been replaced by suits, and mirrors and axes, by dollars and kinas, but the outcome remains the same.
On Monday PNG police shot dead 12 youth on the island of New Britain who were alleged to have robbed a shop. This has sparked an online debate about the failure of the government to provide opportunities for its youth.
As usual the discourse centered around comparing corrupt public officials who steal millions and are not being held accountable as opposed to youth who steal and get killed. A population that’s ignorant of the robbery that’s happening in the resource sector will continue to argue over scraps.
The underlying problem is that the government of PNG receives very little revenue from the export of resources. The size of the pie is too small to go around for everyone.
In fact, one of the main reasons why PNG has had foreign exchange problems for decades is that its main export earner does not remit much foreign exchange back to the country. Whilst the resource sector represents nearly 90 percent of PNG’s foreign exchange earnings, much of that does not return to the country to support the Kina (PNG’s local currency). Imported goods will remain expensive as long as there isn’t much foreign currency flowing inward to increase value of the Kina.
A vicious cycle
The fundamental flaw is that resource contracts are poorly negotiated. One would think that after 51 years of Independence PNG would finally wake up.
Last week however, PNG’s Parliament voted to perpetuate the problem by passing Income Tax Amendments and Fiscal Stabilization Agreements that favour rich multinational corporations involved in the Papua Liquefied Natural Gas (Papua LNG) project. These are multi-year resource agreements that were passed into law serve the interests of multi-national corporations by protecting them against changes in future government policy. The cost of this is estimated to be K10 billion to K28 billion in foregone tax revenue to the government.
On Monday night, the building housing the Treasury office of the host province of the Papua LNG was gutted by fire. Although the cause of the fire has been linked to faulty solar connections, it is an ominous sign of how much of a nation’s future is being torched by flawed resource contracts.
What the Pacific can learn from PNG?
Papua New Guinea has always signed bad resource contracts that have favoured foreign multinational corporations (MNCs) more than the government and people of PNG.
Pacific Islands governments and people need to ask what is their take from the value of the export of their natural resources.
PNG has sacrificed its people and the environment based on the assumption the economic gains outweigh the costs of resource extraction. However, having failed to secure a good fiscal agreement, the social and environmental costs have been greater than the gains. Pacific Islands governments need to secure fiscal agreements whose benefits outweigh the social and environmental costs.
Foreign multinational corporations are well resourced and have decades if not centuries of experience negotiating fiscal agreements compared to Pacific Island nations. Do not go to the negotiating table looking desperate for economic development. Papua New Guinea’s desperation has been a weakness exploited to perfection by the MNCs.
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About the Collaborator:
Martyn Namorong
Martyn Namorong is a Papua New Guinean writer and blogger. He has experience working in government, civil society and the private sector. His most recent stint was as an advisor at the Ministry of Treasury of Papua New Guinea. Martyn's passion has been about deconstructing existing narratives that oppress people and bridging the gap between the margins and centers of power.
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