New Developments

P-NG Wants A Share Of New Developments

From a Port Moresby Correspondent The Papua-New Guinea Administration announced in the House of Assembly on November 21 that it may acquire substantial shareholdings in all major business ventures under taken in the territory.

Tfhu 8 ° rw L f £ er . r - h- W. Johnson, said the Administration had already negotia^lons for equity in fcmr large companies currently operating m New Guinea.

These were Conzmc Riotinto of C o'r °nwealth Ne !J Guinea Timbers, Harrisons and Crossfield and Bougainville Develop- Corporation.

Mr. Johnson told the House that special opportunities would be provided for New Guineans to obtain shares in these companies. be H d £ o„ d i d bW ob^rflTerf saute £ - y p W^ ld T. be n , from the P-NG Development B Jr t ?J ?£ tiv e groups.

Mr Johnson said that in principle lif ™;£l. ni t tratlon a ? ted shares n Terrhn™* busmess mterests m the Th* ?vt on t ♦ ,• . ... 1 1 T lCh 11 '! v ° uld be take - up sha res and m how bv tL pmnnn ! f S r.Y° U d be dcte . l j m *J led by the amount of money available.

Questioned outside the House, Mr.

Johnson said one of the major factors which had influenced the Administration in making this de cision had been the opposition of natives in the Kieta area of Bougain ville to the proposed copper mining venture there by CRA. PP 8 Mr. Johnson told the House that if CRA went ahead with the project, shares in the company would be made available to the people of Bougain ville, including landowners in the actual mining area.

Equity

He * aid an equity in any ma j° r enterprise financed and operated by overseas interests could be taken up through the Development Bank. The Administration would hold this equity interest for later disposal as any future Government of the self-gov ermng territory might determine.

Participation might be arranged in two . wa Ys—first by administration equity in large-scale operations and

secondly by the people of the terri tory, either individually or in groups, becoming shareholders in the enter prise.

“Both things may hap p e n,” he said.

Mr. Johnson said the principle of equity interest would apply to new or expanding interests in the terri tory.

Mr. Johnson told the House the administration had decided to “par ticipate in a substantial way” in Harrisons and Crossfield palm oil project in New Britain.

“Initial investment in this joint

(Continued on p. 148)

project is expected to amount to two and a half million dollars,” he said, Commonwealth New Guinea Timbers Limited was an impressive example of co-operation between pri vate and overseas investors and Gov ernment. The majority holding of capital in this venture was held by the Commonwealth Government, Mr.

Johnson said Mr. Johnson said the Bougainville Development Corporation, which was shipping timber from the Tonolei area of Bougainville to Japan, ex pected to make equity shares 4vail able for purchase directly by local nA . F , , ,1 „ i r\/-Q people not later than 1968.

Rlotmto a lre ady had spent $2,500,000 on copper exploration on Bougainville.

“If the company decides to go ahead with this project it will require a total investment of the order of 60 to 100 million dollars,” he said.

Negotiations on conditions for the granting of the mining lease were now underway. An important factor in these discussions was the question of substantial territory participation in the enterprise, Mr. Johnson said,

When Mr. Johnson said the CRA problem was a major factor behind the Government’s announcement he was, apparently, referring to the timing of the announcement.

The new policy has not been developed as a panic measure follow ing the Bougainville troubles. The major reason for it has been the reaction of the Australian electorate to overseas investments in Australia— particularly American investments which have no Australian participa tion and where large profits have been channelled back to the States.

Cabinet does not want to see a similar pattern of development in Papua-New Guinea, where the UN would have something to say.

But undoubtedly, the CRA trouble has been seen as an opportune time for launching the scheme, and as a result there are still details to be worked out. The Administration doesn’t know how far it will go.

Certainly Canberra has no inten tion of making large investments willy-nilly, or giving the impression that it is going to “nationalise” com merce, thus there is no cause for concern by private enterprise that the investment climate will be upset.