A more positive Pacific solution

That sinking feeling is very strong inside the palm-fringed shorelines of the Pacific islands, where about 4 million people are clustered. As well as rising sea levels, their slow-growing economies face being swamped by a projected doubling of populations in coming decades.

The biggest country, Papua New Guinea, sees salvation in a $16 billion Exxon-Mobil liquefied natural gas project, which will instantly double its GDP when it starts up in 2014. A new gold mine in the Solomons will pull in 1000 workers, and the relocation of US forces to Guam many thousands more.

But the boost to gross national product, what is left after the foreign gas companies, for example, take their revenues, will be much less. And after construction, employment would contract to several hundred operators, with 60,000 local land-owners receiving some rent.

The PNG Government will receive a billion-dollar, or 25 per cent, revenue boost. But as the latest Pacific Economic Bulletin points out, it splurged revenues of the last big resource projects in the early 1990s without raising general income and welfare. It may be already spending the gas revenues before they start arriving.

So what to offer the many thousands of young people reaching working age each year? Two radical notions emerged this week to shift our thinking.

One came from an engaging museum director-turned-MP from Vanuatu, Ralph Regenvanu.

At a Lowy Institute forum in Brisbane he said Vanuatu’s 220,000 people had been largely unaffected by the global financial crisis – because they did not belong to the modern economy. About 80 per cent live in the traditional village economy, while even the rest – including his Port Vila constituents – rely on tradition and kinship for food, work exchanges and dispute settlement.

The traditional economies in PNG, the Solomons and Vanuatu had expanded to cope with some of the highest population growth anywhere, and provided food and shelter (if not modern medicines to fight malaria) where the modern economy collapsed altogether, as in Bougainville during its civil war.

”We must make deliberate efforts to maintain the traditional economy where it exists in the Pacific and ensure that it remains as our buffer in the uncertain global economy into the future,” Regenvanu said. It had to be somehow entered into economic statistics, and its supports like traditional land tenure maintained.

Sydney Morning Herald