Developing a Strategy for the Border Region between Australia and PNG

Guest blog written by Geoff King

This is a blog series written by the alumni of the Leading Economic Growth Executive Education Program at the Harvard Kennedy School. Participants successfully completed this 10-week online course in July 2020. These are their learning journey stories.

Having worked as a development professional for the better part of two decades, I was hoping Leading Economic Development would deliver a few additional tools I could add to my well worn tool belt. However, in several fundamental ways it has led to the evolution of my thinking and changed my practice.  

Growth diagnostics informed by complexity analysis, have changed the way I view the challenge of economic development.  The method, presented using accessible analogies, are powerful analytical tools that can help identify points of entry for further diagnosis/analysis informing economic development strategy.  I will never think of monkeys in trees the same!  

I was broadly familiar with PDIA thinking. However, applying the approach to a case I am currently working on brought the theory to life. From my experience, project/ program documents have become littered with claims of adaptation, iteration and learning as you go, but the rhetoric rarely translates into reality. 

PDIA uses an accessible conceptual vocabulary to provide a systemic, yet flexible, approach to complex (often meta) problems supported by practical tools and processes. While individual case studies demonstrate its success, a meta-study demonstrating its efficacy in a larger population of cases would help in gaining the support of skeptical decision makers questioning case selection bias (picking winners).

Working for the Australian Government in PNG, I lead a team that in week two of the course was tasked with developing a development strategy for the border region between Australia’s Torres Strait and PNG’s South Fly district of PNG. 

At its closest point, PNG and Australia are only four km of open water apart. Australia’s per capita GNP is 21 times that of PNG. One of if not the largest disparity in the world for any two countries sharing a border.  The gross regional product of the Far North Queensland region, comprised of 260,000 people, is one third of the GDP of PNG, with a population exceeding 8 million.  Life expectancy in South Fly is estimated to be around 60 years and maternal and child mortality is extremely high. In comparison, Australia ranks sixth on the global Human Development Index league table.

The region is ethnically and linguistically diverse, but has english as the lingua franca spoken by the vast majority of residents and taught in schools. This common language, to a degree, shapes a regional identity.  

Identity is also shaped by the proximity to the Australian and Indonesian borders. Cross border kinship relations are common as our informal trading relationships

A treaty between the two countries recognizes the traditional kinship and cultural ties and practices between border communities. Australian Torres Strait communities and 14 “Treaty Villages” in PNG have reciprocal border crossing privileges. 

The traffic of drugs, people and guns from Indonesia through the porous PNG border is a growing concern for Australia and PNG. Drug resistant TB and other communicable diseases are prevalent in South Fly.

Covid-19 has further exacerbated the health risk and the borders between the nations have been formally shut.  Attempts to cross the Australian border are being repulsed, other than acute medical emergencies, by border patrols augmented by military and police.

The complexity of the problem reflects the complexity of the context. Frankly, it is this hard to know where to start.  There is no single problem. Rather, a meta problem and many sub-problems.

South Fly suffers from poor economic diversity reflected in an over-reliance on subsistence agriculture, hunting and fishing. This reflects a dearth of capacity in the form specialized tools, codes and tacit knowledge.

The meta problem or challenge is to build linkages between Far North Queensland and Western Province that will create economic opportunity and improve human development.  This framing is insufficient to galvanize support and spur action.  A more tangible empirical objective will need to be identified out of already underway analysis discussed later.

Supporting this objective is greater focus and alignment of Australia’s AUD $500m annual grant aid to PNG and the possibility of PNG infrastructure investments through Australian Government concessional low interest loans.

Australia’s development assistance is organized along sectoral lines working with national agencies building  influence and relationships with Ministers and senior officials important to Australia’s interests and PNG’s development.

Covid 19 has heightened awareness of border issues opening a window of opportunity to challenge the sectoral development paradigm by adopting a place based approach in the South Fly district. 

The authorizing environment has shifted. The challenge is to leverage this shift into repositioned human and financial resources to pursue the meta problem. A short initial strategy document is being prepared to lock in PNG and Australian support for the approach.

Subsidence gardens are ubiquitous in Western Province, but so is the need for cash to pay for education, health care and household goods. Understanding how people interact with the informal economy where they earn cash and identifying factors constraining households ability to generate additional revenue makes sense. Anecdotal information suggests that the price of fuel, three to four times the cost in the capital Port Moresby, is a key impediment. 

The hard work of crawling the design space has already begun. There are opportunities to increase the nascent complexity of the product space in the region by focusing on cross border complementarities leveraging existing familial and kinship relations and informal economic networks. Leveraging and building upon this advantage to foster trade can deliver regional growth.

The fishbone tool helped identify a restrictive interpretation of the Torres Strait treaty between PNG and Australia as a binding constraint to growth in the region. The treaty allows for trade, but the Australian interpretation of trade, as expressed in administrative rules, is restricted to bartering of a limited range of culturally significant goods. 

The narrow interpretation is designed to limit cross border traffic and activity, to lessen health and other risks to Australia. While this makes sense from a security perspective, it also acts as a brake on South Fly development. 

Australian security agencies acknowledge the development of the region is the best long term approach to ensuring security on both sides of the border.

Another binding constraint is the high cost of fuel, which is three to four times the cost in the capital Port Moresby. The cost of transporting goods to and from Western Province Villages, all reliant on maritime transport and trekking inland, is prohibitive.

The other fishbone components, I would describe as opportunities to increase trade that could be worked upon once the two binding constraints are alleviated. 

There is a clear sequencing imperative here.

Building a team whose knowledge and networks can be leveraged is essential to this endeavour.

A recent book by a group of University of Queensland academics analyzed the border region in some detail. We have engaged the team leader who has decades of experience in the region.  We have also brought on board an experienced PDIA practitioner with experience in a number of countries. These two will be essential to formulating our initial strategy and successfully identifying and engaging PNG counterparts.

The list of potential PNG and Australian organizations that could join the team is long. Interest is high and the challenge will be in identifying individuals with influence, a deep understanding of formal and, more importantly in the PNG context, informal institutions and a willingness to adopt the PDIA approach. 

Different levels of the PNG government are very supportive of the initiative, but blockers may emerge if existing informal channels of power and rent seeking are imperiled. We will have to tread carefully.

In the region itself, the different tribal communities have a complex and periodically conflictual relationship that can be a mine field to navigate.  Bringing local political economy knowledge into the team will be essential.  An existing network of Australian funded Community Rangers will be a key asset in this endevour.

The growth strategy and specific tactics will need to be owned by the affected communities. A top down approach will not work in a society characterized by communal ownership of land, reciprocity of exchange and extended kinship responsibilities.

Concomitant to developing a high level strategy and building the team, we are working to increase our understanding of the two binding constraints identified through preliminary analysis.

We have engaged Australian whole of government agencies in one on one discussions to better understand the rationale behind the narrow administrative interpretation of the treaty language.  These exploratory discussions will assess the policy space by feeling out existing rigidities and the willingness to entertain flexible alternative approaches.  

Once complete, this will inform a secondary strategy engaging business interests on both sides of the border to assess and generate interest in the proposal. 

These discussions ought to generate additional entry points and provide direction around sequencing of further actions. 

We have started a household survey process in South Fly to create a baseline and assess binding constraints generally with a specific focus on the cause and impact of inflated petrol prices. This data will inform the identification of further entry points for learning and action using the problem tree heuristic.

Subsiding transport through a voucher system is an early idea that will be explored with current maritime operators and communities.

Discussions with operators will also be used to understand the existing petrol supply chain to try and identify options for exploration such as attracting new petrol suppliers to enter the market.

There is much work to be done, but the process underway. This is in no small part thanks to The Leading Economic Growth course.

To my mind the course is really a call to action underpinned by applied theory, practical tools and an approach to making change happen. The challenge is to answer the call by evolving your approach to development and fighting for space within your organization to put it into practice.

To learn more about Leading Economic Growth (LEG) watch the faculty video, and visit the course website.

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