PT MAG ISSUE 11

PRIF

THE PIPELINE AND THE PRIVATE SECTOR

DAVID SPRING PT COLUMNIST Sydney, Australia

BEST known for their contributions to National Infrastructure Investment Plans (NIIPs), which have proliferated across the Pacific for a decade, the Pacific Region Infrastructure Facility (PRIF) now also hosts an annual “PRIF Week”. From 17 - 22 October 2022, PRIF, a club of western donors to the Pacific, held the event for only the second time. This year’s theme, ‘Enhancing Private Sector and Local Participation in Pacific Infrastructure’ was pitched at local firms and contractors who are seeking a larger slice of the donor-led infrastructure pie.

PRIF Week highlighted initiatives, presented project examples and convened panels, in a hybrid format across four live sites. Topics traversed the five sectors of PRIF’s engagement - energy, telecommunications, transport, urban development, and water and sanitation.

The theme was a smart choice – dangling the carrot

of gaining insider knowledge of the infrastructure project pipeline, and tapping into the pride held for homegrown Pacific businesses that lead economic growth. The theme also connects to the broader agenda of private sector development, which started appearing in the literature around 2008, and is now entrenched in donor portfolios. The agenda is to modernise business laws, increase access to finance, reform state-owned enterprises, create consumer protections and empower women’s role in the economy. PRIF Week reiterated these narratives.

n Local content is good business

The concept of ‘local content’ surfaced several times during the Week, drawing attention to the ways in which the local content in infrastructure projects

can be increased. ‘Local content’ is another way of saying that firms from the countries where the work is taking place actually deliver part of the consulting services or construction works. It’s not clear why this is innovative, as it makes good business sense – it keeps costs lower and improves the relevance and effectiveness of operations and services. Yet local firms missing out on this type of work is a common complaint, reasons notwithstanding. This theme is welcome, in response to that complaint. One angle on this was encouraging international contractors to leave behind a legacy beyond just the hard infrastructure, in the form of skills, training, knowledge, experience. This so called ‘capacity building’ is to be directed towards the goal of local firms taking up increasingly complex roles in infrastructure projects. This is standard development theory but is unlikely to happen if normal business incentives apply. Further thought would have to be put into why such a transfer of skills and transition of responsibilities would occur. (See our story on the Solomon Islands’ Hatanga – BY Group partnership for an alternative example, pXX).

n Show me the pipeline

The Fiji Roads Authority (FRA) and Pacific Building Solutions (a Fijian contractor) sat on a panel discussing ‘growth in local contractor participation’. It was highlighted that FRA’s strategic policy to deliver a program of work, that includes local content policies, has helped over time to develop the whole local contracting industry. Local preference in procurement lowers the hurdles for local firms to participate and simultaneously raises them for internationals. This changes the mix of expertise, experience and the financial backing of selected contractors, changing a client’s risk profile with it. Notwithstanding, if growth in the local contracting market is the goal, simply delivering a consistent pipeline of work to the domestic market will provide the certainty needed for long term business investments. Donors cannot always provide this, hence it is not typically a feature of the private sector development discourse. But FRA can, as can mechanisms such as the National Transport Funds in Solomon Islands and PNG (when free of meddling, foreign and domestic!).

Asian Development Bank’s Katherine Guy presented on transport sector trends they’re seeing and ADB’s upcoming plans in the Pacific. The overall value of ADB’s USD 2.3bn pipeline is heavily skewed by a massive investment in land transport in PNG of USD 1.6bn, predominantly for the Sustainable Highlands Highway Investment Program. The

remainder of the land, maritime and aviation projects will hopefully be more suitable for the domestic private sector. An initiative called the Pacific Project Series, supported by New Zealand’s Ministry of Foreign Affairs and Trade (MFAT) and Austrade was discussed and promoted in one session featuring the maritime sector in Tuvalu. DT Global’s Induni Seranath and team profiled the scope, scale and considerations made in the preparation of the Tuvalu wharf projects for market, including how price inflation risks were factored into the budget allowances. The Pacific Project Series is intended to give firms awareness of broader opportunities but also some specific upcoming project opportunities. The information is disseminated through webinars to profile individual large scale projects, hear directly from those who are preparing them and are open for Q&A.

n It's not you it’s me

These sorts of conferences are a case study in the dance between the donor industry and the Pacific. Each stakeholder has a different reason for attendance and a different reason for presenting. The often guarded and euphemistic ways of speaking (e.g., ‘capacity building’; improve enabling environments’) are better suited to diplomacy than engineering. The deference is as charming as it can be awkward. And yet, the purpose is served – the private sector has visibility of the pipeline. Often this is all they need. PRIF will do well to continue production of NIIPs and fulfil their purpose as a facilitator of adequate investment in this infrastructure pipeline. l

About the Author

David is an experienced engineer, with over 20 years experience in construction, design and international development. David has been working in Solomon Islands and Vanuatu as a team leader for the past six years, specifically on road and bridgeworks. He worked on intraMinistry roles at the Ministry of infrastructure Development (MID, Solomon Islands) and led the Cyclone Pam road reconstruction project in Vanuatu, understanding donor requirements and how development projects are procured and delivered. Continuing as a Team leader for MID and with some corporate responsibilities for Cardno, David seeks to deliver equitable access for communities, which generate social and economic benefits.

First Nations First

Hatanga and BY Group join forces

WHEN Penny Wong, Australia’s new Foreign Minister visited Honiara in June, she restated a new direction in Australian foreign policy – a first nations foreign policy. It is an idea that resonates readily with politicians and everyday people, but what exactly does it mean? As policymakers grappled with the implications, who would have thought that the first tangible evidence of what it could mean would be in the infrastructure industry?

Not hatched in departmental backrooms but born of practical business needs and innovation, Hatanga of Solomon Islands and BY Group, an indigenous Australian firm, formed an agreement to work together on a range of business enterprises. In a ceremony in October, celebrating the indigenous cultures of both countries, the arrangement was formalised in the presence of high-level dignitaries,

indicating the significance of the initiative.

What’s new?

International firms have long made partnerships with local firms, to give them an enduring presence, greater legitimacy to operate, local knowledge and access to materials, plant and labour – all to provide a competitive edge. FletcherKwaimani is a good Solomon Islands example of this. The Hatanga – BY Group partnership is different. For starters, the unique character of each firm has been intentionally retained. Further, the partnership is not for the sole purpose of BY Group winning work in Solomon Islands as a head contractor. And, the benefits are mutual: for upskilling workers through formal training and work

Many returns: Presentation of a boomerang as part of the Hatanga – BY Group ceremony.

experience, sharing of resources and systems and for developing business strategies. The partnership will promote stronger local contractor participation in the delivery of national infrastructure projects.

Why now?

As Hatanga General Manager, Jeremy Bartlett says, ‘the time is right. We’ve had a lot of disruptions and difficulties during COVID, in getting projects off the ground, in getting the best trainers in, in sourcing skills. Our partnership with BY Group gives us access to the support we’ve been looking for.’

BY Group’s work in Australia includes buildings and civil works for Australian Government clients – experience that will enable specific expertise to be applied to Australian aid programs such as the Solomon Islands Infrastructure Program (SIIP). BY Group’s indigenous identity also gives them access to Australian’s indigenous procurement policy. Combining this with the Solomon Islands Government’s push for the inclusion of “local content” means that, large or small, locally or foreign funded, the firms will be able to demonstrate consistency with these requirements.

BY Group walks the talk. They are not only certified as an indigenous firm, 50% of their staff are indigenous. They are FSC accredited for their safety systems and ISO accredited for all their systems. Malcolm Devin, BY Group’s General Manager is proud of what these accreditations demonstrate about their capabilities, but is interested in the social outcomes that can be achieved: “By putting thought into how projects are procured, governments and agencies can get more than just hard infrastructure outcomes – the community benefits too.”

Hatanga is Solomon Islands’ largest construction firm, delivering buildings, civil works and logistics for almost

12 years for government and agencies. Hatanga means ‘together’ and sees its work as an opportunity to create value for communities. Local content in the construction industry is about developing capabilities and joining with BY Group enables rapid, intentional and strategic development of both broad and specialist capabilities.

Nations first with First Nations

The Hatanga – BY Group partnership demonstrates that, whether by design or coincidence, business imperatives can support foreign and domestic policy agendas. Both the Australian and Solomon Islands Governments have reason to support this partnership. Seeing it flourish will fulfill overlapping visions for what the two nations can achieve together – significance, recognition and growing economic and social capital. First Nations foreign policy may indeed mean putting another nation’s priorities first. l

Hatanga ‘Together’ – pictured are trainees who received the Australian construction ‘White Card’ training from BY Group in October.

Ensuring Legitimacy of Building Standards

MATERIALS used in construction signifies structural existence. It demonstrates the presence of aesthetic sense in a design, and hence, defines the practicability of the structure.

The use of building material(s)while designing a structure is symbolic of its existence in the field of architectural visualization.

The Ministry of Infrastructure Development’s Architecture Building Management Services Department (ABMSD) is responsible for maintaining building safety standards, and inspecting and scoping for identification of maintenance needs. They also conceptualize designs and carry out technical evaluation and recommendation.

According to the Director of ABMSD Mr. Phillip Baura, his department has very limited resources and capacity yet play a key role within its umbrella Ministry to ensure longevity and quality of government structural assets whilst ensuring building standards.

The ABMS Department is responsible for planning,

designing, building and maintenance of all government buildings and assets nationwide.

According to Mr. Baura his department has a total of 18 personnel whom most time are out in the Provinces thus they have limited operational capacity.

Basically, each government Ministry have their own building projects to deliver according to their development plans. ABMSs’ role is simply to assess and advise procurement teams on standards and best practices usually before a tender is released and during the tender evaluation stage.

“Sometimes we outsource tasks like architectural design since we have limited capacity so and we focus specifically on Project management,” Baura Said So, if a Ministry wants to build a new office building in the province, they will request the ABMS team to do the scoping of the said project. Once done they will then outsource the architectural design work to a private contractor to assist. Once a design is ready, they will

Top left: An aerial view of the MID compound.

Top and bottom right: The MID Architecture Building Management Services Department (ABMSD) team.

Left: Director of ABMSD Mr. Phillip Baura

submit the documents to the respective Ministry to approve and facilitate the tender process.

Under Mr. Baura supervision at the Ministry he has come to realise that a lot of government buildings situated in the Provinces are very old and can no longer withstand continuous repairs.

“Ever since I started looking after this department, I have seen a lot of aging government buildings especially in the Provinces, some have not been repaired for almost 10-15 years leaving them vulnerable to termites and asbestos. The only logical call I usually make is to demolish and rebuild,” the Director said.

Currently the ABMS team operates on two separate budgets, a development budget and a recurrent budget.

The ABMS team is currently working on 3 major projects, two with the Ministry of Agriculture and another with the Ministry of Infrastructure Development.

The two MAL projects include the new provincial office building at Buala, Isabel Province which is just over ninety percent completion and the country’s first ever Biosecurity Quarantine facility.

The New agriculture office complex at Buala, Isabel is

being built by Dikei Constructions.

The New Biodiversity Quarantine facility at Henderson, Central Guadalcanal is being constructed by Jiemie Constructions.

The vapor heat treatment project will cost the Government around SB$7 Million to complete and this will greatly benefit rural famers to export their end products.

Another project in which Phillip and his team will be undertaking will be for the new vehicle test lanes at the MID vehicle inspection site at Matanikau.

According to Mr. Baura a new Tender for the contract will be releases before the end of 2022 so that work can begin on the warehouse structure early next year. The technical installations for the facility will be done by MAHA group. l

SICCI WELCOME PM'S ASSURANCE OF SUPPORT PACKAGE FOR BUSINESSES

SICCI Board Chairman, Mr. Ricky Fuo’o said “this will provide hope for many businesses that have had their properties and businesses looted, destroyed, and burnt down and how they will get through the challenges faced.”

The SICCI Chairman was speaking after during the recent Prime Minister’s Breakfast event, an initiative under the MoU between Government and the private sector which presents the opportunity for SICCI members to engage directly with the country’s leadership and creates a platform for the Prime Minister engage to directly with taxpayers.

Delivering the keynote address at the event, Prime Minister Hon Manasseh Sogavare reassured that Government have agreed to allocate $200 Million as recovery package post-riot 2021. The amount is appropriated under the 2022 budget (125M) and 2023 budget (75M).

“On top of the grant support, the government is offering limited duty and tax exemption on imports of materials and goods that go towards business recovery. The other element of support for recovery is a concessional lending product through the DBSI,” the Prime Minister explained.

“This is to support SICCI property owners and retail sector to rebuild and recover from the impact of the riot.

“The Ministry of Finance and Treasury is currently lining up funding arrangement to quickly roll out assistance in the coming days. More assistance will go to affected businesses in the next few weeks,” Prime Minister, Hon Sogavare, told businesses during the PM’s Breakfast.

The recovery package will assist business houses to rebuild properties that were burned down in the November 2021 riots and recover the retail sector economy.

In response, Mr. Fuo’o said this is what the Chamber has been calling for on behalf of the business community, a forwardlooking announcement that provides confidence for impacted businesses.

“This support will assist many businesses” and that it “will provide a much-needed lifeline given these same businesses are

SICCI Board Chairman, Mr. Ricky Fuo’o.

still also recovering from the impacts of COVID-19,” he said. He said, “This package will go a long way to support not only businesses but also ordinary Solomon Islanders whose livelihoods depend on these businesses staying operational and providing the much-needed employment.”

In a recent survey conducted by SICCI highlighted that the unrest in November last year posed huge destruction to most businesses. Survey respondents indicated that the unrest causes huge reduction of sales due to burning and close down of business. This leads to decline purchasing power of customers. It also causes increased cost of goods in the shops and increased cost of labor, leading to incursion of extra excessive recurring costs. l SICCI Media

The Solomon Islands Chamber of Commerce and Industry (SICCI), as the peak body representing private sector, welcomes the assurance given by the government for a recovery package for businesses badly affected by the 2021 riots.

Geopolitical Crossroads: INFRASTRUCTURE DEVELOPMENT / INDUSTRY

Countries don’t have friends, they have interests. The recent flurry of diplomacy with Solomon Islands is a case study in attempts to align national interests. Sparked by the signing of a security pact between Beijing and Honiara, the country is now at the centre of a high-stakes geopolitical contest actuated as the Chinese seek a physical presence in the South Pacific. Foreign countries who have defended and invested in Solomon Islands since the 1940s, in line with their own national interests, have until now, enjoyed the support that investment has earned. They are now scrambling to deter the appeal of the Chinese proposition.

For a long time, the Solomon Islands government has been dissatisfied with a shortage of tangible outcomes from the development process offered by Western bilateral programs and multilateral banks. Since the end of the ‘Tensions’ in 2003 (refer next section) Solomon Islands’ Gross National Income (GNI) per capita has only increased from $1600 to $2200 and has been flat for a decade. New investments through the ‘traditional’ aid donors take years to materialise, seem impervious to the government’s agenda and are curtailed in scale by sensitivities to ‘safeguards’ and debt management.

The search for a more sympathetic donor is understandable. The diplomatic switch from Taiwan to China in 2019 was the government’s bold move in a new direction.

The short-term results from the ‘switch’ look bright – renewed interest from Western partners, new stadiums funded by China, the promise of heavy-handed security support to discourage

future outbreaks of violence, and high expectations for ongoing interest and investment to deliver ‘development’ that pleases the government. But what else is at stake?

This article explores the impact on the delivery and maintenance of infrastructure assets, created by the intersections and implications of this geopolitical contest. What delivery modes are most likely? What types of new infrastructure will be preferred and how will it be maintained? More importantly, how will the institutions that deliver and maintain it be supported? How will the local contracting market and general operating environment be affected? And how will all of this affect the people – the continued focus on foreigners hopelessly ignores the reality of how Solomon Islands functions – its wantok system, its priorities, the way decisions are made and its national unity. Perhaps the emboldened sovereignty of the government is the outcome of 20 years of effective institution building and reflects the democratic voice of Solomon Islanders demanding better standards of living.

n Tense Tensions

To understand the situations of today, one must look to the past. Solomon Islands’ recent history has been overshadowed by the 1998-2003 period of civil unrest, known as the ‘Tensions’ and their aftermath. The inability of the government to implement the Townsville Peace Agreement (October 2000), forged after an effective coup, led to a request for an Australian-led Regional Assistance Mission to Solomon Islands (RAMSI) in 2003, to establish and maintain law and order. The initial phase of the mission was a success, but the longer-term development and institution building had mixed results. The challenges encountered arose from colonial legacies, flawed RAMSI assumptions about state-building

DAVID SPRING PT COLUMNIST Sydney, Australia

and the intrinsically political nature of such an intervention, including the Taiwan-China rivalry, which played out in Solomon Islands, as it has in other Pacific nations. What’s not in doubt is that RAMSI reversed the trajectory of decline into anarchy and failed statehood.

RAMSI served as an anchor for Australian bi-lateral assistance -approximately AUD 3 billion was spent over 15 years on a range of law and justice, economic governance and government services, not to mention the broader aid program. Following the completion of RAMSI in 2017 and co-incident with an Australian Foreign Policy White Paper, this moment signalled a transition in Australia’s engagement with Solomon Islands.

n To donors, with love

It’s incorrect to focus on Australia at the geopolitical crossroads in which Solomon Islands now finds itself. To do so would be to double down on an error which has contributed to the Solomon Islands’ government’s current trajectory. This trajectory is being set by their courting of a partner that seems to understand what they want: in simple terms, overt ‘infrastructure’, demonstrable development and more muscular security.

Solomon Islands has a range of long-term arrangements for receiving overseas development assistance – New Zealand, Japan, South Korea, United Kingdom, United States, European Union and of course Australia. These donors, along with the multi-lateral banks, tend to fund health and agriculture programs, infrastructure, education and tourism sector initiatives, usually in parallel with institutional strengthening, economic reform and governance programs. Such aid is in service of the status quo power balance in the Pacific – the Western power axis wants to maintain stability in the western Pacific, existing trade routes and geographical buffers to the Antipodes’ northern approaches.

From 1983-2019, the Republic of China (ROC) – Taiwan – provided aid to the government too, through health and agriculture programs, and contributions to the controversial ‘Rural Constituency Development Fund’ (RCDF). The RCDF was an untied fund controlled by MPs to spend on measures ostensibly to assist their constituents. “These funds have transformed Solomon Islands’ political landscape by shifting the political power base away from voters and government bureaucracy and into the hands of politicians.”

The fungibility of the RCDF led to frequent accusations that these funds were used for personal gain and undermined the institutional reforms being funded by other donors. Although their contribution reduced over the years, for a long time the Taiwanese effectively used the RCDF as an inducement to retain the support of MPs for diplomatic recognition of the ROC.

Yet in doing so, they sowed seeds of distrust in Taiwan amongst Solomon Islanders and elites – the RCDF enabled the perception of corruption to flourish. The RCDF was synonymous with Taiwan and so was any criticism of it. This was unfortunate, as their agriculture and health programs were very effective. The form of the RCDF weakened the public service and public financial management, further increasing the opportunity for others to emulate the modus and seek undue influence.

the critical factor in the Solomon Islands’ 2019 switch from Taiwan to China was not inducements but economic. “China is far and away Solomon Islands’ largest export market. The most recent figures (for 2016) from the Department of Foreign Affairs and Trade in Australia state that over 62 per cent of Solomons’ exports go to China. (This is virtually all logs.)

However, the critical factor in the Solomon Islands’ 2019 switch from Taiwan to China was not inducements but economic. “China is far and away Solomon Islands’ largest export market. The most recent figures (for 2016) from the Department of Foreign Affairs and Trade in Australia state that over 62 per cent of Solomons’ exports go to China. (This is virtually all logs.) By contrast, Taiwan takes around only one per cent of exports from Solomon Islands. Such a level of economic dependence on China leaves Solomon Islands highly vulnerable to economic pressure.”

While secondary to the economic importance of trade, Mainland Chinese have long been part of the economic fabric of Honiara and now other key regional centres, Auki and Gizo. Chinese-owned businesses’ influence is as disproportionate as their ability to secure visas, building permits and licences is remarkable. Regardless, their presence and integration with the economy gives purchase and legitimacy to Chinese interests.

This combination of factors influenced the government’s decision to switch. “They had seen and were lured by the Chinese investments in the other Pacific Island countries they have diplomatic relations with. It was also obvious that China already had a strong informal presence in the country through its citizens, its trade and ongoing investments from Chineseowned businesses. The potential for greater investment and trade was a major driver to switch to China.”

It is no great surprise that it was the Sogavare government that made the diplomatic switch to China. Sogavare had flirted with a diplomatic switch while he was Prime Minister in 2006-07, but that was more likely a tactic to leverage greater funding from Taiwan at the time. Sogavare also has exhibited a slow burn of resistance to Australian aid and interventions, centring on anti-RAMSI (specifically anti-Australia) rhetoric. If we listen to Sogavare’s recent thundering, we find the common thread of assertive sovereignty – an enduring reaction to the characteristic paternalism of aid programs from the Western axis. He is outwardly seeking greater economic opportunity

compared to the invisibility of reform and governance programs.

Yet, by making the switch, against the recommendation of the bipartisan Foreign Relations Committee, Solomon Islands has rolled the dice that the ‘traditional’ aid partners will continue to contribute not only aid, but other advantages that cordial diplomatic relations afford, such as access to labour schemes, training, technical expertise, election support, security deployments and proximate health care. Perhaps these are no longer valued and are considered to be not worth the shortcomings and frustrations of Western aid. The switch makes the nature of future infrastructure investments from these countries less certain.

n Chinese ambition

The security deal between China and the Solomon Islands did not materialise out of thin air. A long-term Chinese disposition of engagement can be traced – economic engagement of the Chinese diaspora, primary trade partner, diplomatic recognition, soft power initiatives, state-owned companies expanding, security agreements. Chinese state-owned and private companies now seek economic opportunities abroad (partly encouraged by the ‘Go Out/Go Global’ strategy).” China has courted the elite, built bonds with regional institutions, and increased both its aid and its investments across the region. The Solomon Islands government’s calculation is that the funding and investments by existing development partners

will continue (and even ramp up, as they seek to counter China) and that Chinese largesse will expand address any shortfalls that arise if others withdraw. The former assumption has a track-record to support it. The latter, less so. The nature of Chinese intention and ambition are frequently misunderstood. The most common misconception is that because China is a centrally planned, autocratic government, which operates a heavy security and surveillance apparatus, stamps out dissent and makes a show of humbling businesses who stray from the Party line, that every action of the Chinese people is also a co-ordinated action in pursuit of a unified goal. This narrative is well-worn in Solomon Islands – that the growing interests and influence of Chinese businesses, now backed by the ‘switch’, is all part of a grand scheme to corrupt and control the Solomon Islands government, in order to secure minerals and round logs to feed the voracious Chinese appetite for natural resources. The long game, so the story goes, is to put this future outcome beyond doubt and for the People’s Liberation Army (PLA) to gain access to establish a large presence, just 2000km from Australia.

It is unlikely that this is the case – it is at least more complex than the narrative suggests. Interpretation of Chinese actions cannot be reduced to simplistic explanations such as natural resource security or one-upmanship with Taiwan; the broader context of China’s strategic ambitions must be understood. These can be summarised under its stated and demonstrated ‘core interests’, first articulated in 2011 under Hu Jintao, and reinforced and expanded under Xi Jinping

since 2012. In this formulation, China’s core interest in the Pacific is directly related to China’s “territorial integrity and national reunification”, i.e., bringing Taiwan under the rule of the Chinese Communist Party. China’s boldest and most assertive activity need to be understood in the context of their contribution to this core interest.

Competition for diplomatic recognition from Pacific countries heated up in the 1970s and despite some thawing when Taiwanese nationalist parties were in power, the contest for Taiwan’s international legitimacy is fierce. But tussles over diplomatic recognition are only one element of pursuing the core interest. Ultimately, so called ‘reunification’ of Taiwan and mainland China may require military means. If China chooses to exercise that contingency, success would be all but assured if the South China Sea were not contested and if it was surrounded by a buffer of projected power. Pacific Island nations exist in this geographical buffer. Taiwan’s key ally is the U.S. If western Pacific shipping lanes can be controlled and freedom of navigation can be thwarted by China, this will disrupt U.S. ability to intervene in any conflict over Taiwan. Further, a presence will enable the securing of Chinese sea lines of communication, increasing intelligence collection on foreign forces, creating a sense that Australia and New Zealand are boxed in, as well as complicating U.S. plans to move forces into the region. In this light, maritime military presence in the South Pacific beings to make specific sense. However, caution must be applied here – Chinese aid and activity is often driven by the commercial interests of firms, and it is “far more fragmented and incoherent than often assumed.” Not everything that happens can be interpreted through the reunification lens, as it is not all centrally controlled. Similarly, it would be wrong to assume that Solomon Islands has been a passive participant in the pathway to signing the security pact. The agency and intent of the Solomon Islands government to harness what was otherwise a fragmented series of activities, serves their own domestic and political objectives. So, while Chinese core interests are being pursued by the Chinese government, Chinese companies and the Solomon Islands government are also pursuing their core interests – it just so happens that there is currently a very strong alignment between those interests.

Given this state of affairs, is China a reliable development partner? China certainly has the ability to deliver infrastructure investment in Solomon Islands, but many local people are conscious that “Chinese investments are as much about advancing Beijing’s interests and corrupting local politics as they are about meeting local needs.”

n Yankee doodle

The U.S.’ reaction to the signing of the China-Solomon Islands security pact was more muted than Australia’s handwringing, but the implications certainly registered. In 1942, U.S. President Roosevelt articulated the strategic importance of the Pacific Islands. This reality has not changed, though U.S. attention over the past several decades has been elsewhere. Pacific Island leaders frequently reiterate the greatest challenges they face: addressing the existential risks of climate change, collective regional security and the ‘increasingly crowded and complex’ geopolitical environment. Don’t expect that third challenge to be made any easier by the U.S. response to

Chinese expansionism – far greater U.S. engagement. Washington is planning to reopen the U.S. embassy in Solomon Islands that it closed in 1993. They must appoint ambassadors to Fiji or Papua New Guinea – thus far neglected by the Biden Administration – and consider resident ambassadors to Kiribati, Nauru, Samoa, Tonga, Tuvalu and Vanuatu. Addressing the issue of representation will empower the range of activities that ‘greater engagement’ entails. Many are soft power, policy and other forms of assistance, for example, supporting multilateralism in the region. But some challenges – economic development and addressing low-lying vulnerability – can only be solved with resilient infrastructure –ports, domestic wharves, sea walls, roads, bridges, affordable green power and internet connectivity. The combined resources of the ‘traditional’ donors are extensive. Japan has been a long-term and reliable donor to Solomon Islands, committing significant funding to significant projects over recent years – Honiara International Port (second berth), Kukum Highway upgrades and Henderson airport expansion and upgrade. We’ve mentioned Australia’s programs; NZ have a more modest but important role in the aviation and tourism sectors. South Korea, the EU, UK and others have all contributed.

Multilateral banks play a conflicted role. With governance stemming from the relative contributions of each country, Japan and the U.S. have the greatest voting power in the Asian Development Bank (ADB). But China also holds notable voting power and has been able to ensure that ADB procurement rules enable Chinese state-owned companies to bid for construction contracts. Using low pricing has proven to be a very successful strategy, despite building a track record of late-running delivery. The World Bank is U.S. dominated but uses similar ‘harmonised’ procurement policies. There is already a reasonable degree of co-ordination to these efforts – what’s needed is a unifying principle, and the U.S. is capable of providing that leadership. Leadership does not mean inevitable conflict with China, in fact, avoiding it will be part of any U.S. strategy.

n Crystal balls of concrete

Accordingly, a conflict in the form of an infrastructure bidding war in Solomon Islands is now predictable. This could escalate in various directions, but is unlikely to result in economically sustainable, maintainable, durable assets. The competition will likely initiate a shake-up of delivery modes for infrastructure projects. Some of this is much needed. Traditional bilateral and multilateral vehicles have not always delivered the best project outcomes – too slow, ill-suited, obscure, niche, weakly administered. Projects will be redesigned to more narrowly serve the national interests of donors – timely, targeted and with demonstrable benefits. It is also probable that, despite Solomon Islands being due to ‘graduate’ from Least Developed Country (LDC) status in 2024, their eligibility to continue to receive a high proportion of grants to loans will be maintained. Long-term, this will not advance economic maturity.

The rivalry will likely result in a disproportionate focus on either developing, or heading off others from developing, the type of infrastructure that could serve as military ‘bases’ – in practice, even if not in name. A military base is not only a deep-

water port or buildings and equipment inside a secure area.

If PLA personnel arrive to conduct training or defend Chinese infrastructure, they must be housed somewhere and maintain materiel somewhere – at what point does this ‘somewhere’ become a military base? There have been denials all around, about any intent to build a military base, but the grey area will be exploited, called out and defended. Militarisation is ceding sovereignty.

The atmosphere of strategic enmity will likely result in less trust and create an operating environment that is closed and secretive, rather than the open, democratic, co-operative environment that locals and expatriates have built since independence. The typically secretive approach by the Chinese government and the opacity of Solomon Islands’ government around the security pact and its implications breeds suspicion, confusion and miscalculation of intent. This is a disruptive mix when one is trying to develop and deliver public assets.

If the RCDF isn’t already unhelpful enough, the contention will likely result in a weakening of the ability of the public service to process projects. This will undo the decades of work given to strengthen country systems, which was achieved by using them to deliver infrastructure projects. Alternative and parallel systems will be established to bypass the public service ministries, thereby undermining the oversight of the democratically elected Ministers and their departments, reducing accountability at the operational level. The public service will become hollow of meaning – a further disincentive to work there.

A diversion of the purpose of aid will likely result in inappropriate solutions, particularly regarding the long-term maintenance burden of new infrastructure. All countries have an absorption capacity in the expansion of assets that can be maintained. In Solomon Islands, the reality is that maintaining the current levels of road, bridge and wharf infrastructure which is in a maintainable condition (and doesn’t already need rebuilding) is beyond the capacity of the Ministry of Infrastructure Development (MID) to deliver and the government to fund alone. Without increased external assistance, any new infrastructure will not be maintained either.

Overall, the security pact will likely result in less benefits for the people of Solomon Islands, as a sharp power focus zeros in on the specific outcomes that projects must deliver. Achieving these outcomes will be entrusted to donor-country nationals, not Solomon Island locals, even though engaging locals would better serve long-term engagement. Further, the opportunity for local contractors to participate in projects will be reduced. A blurred line already exists between long-term Chinese national contractors and truly local contractors. It is possible that both categories of firms may miss out in the drive to deliver and execute projects, and the increased secrecy around operations. This will not serve the future prosperity of Solomon Islanders.

n Flash points

The next Solomon Islands’ general election is scheduled for mid-June 2023. The government has already unsuccessfully tried to postpone the election under the ruse that the November 2023 Pacific Games preparations will disrupt voter registrations.

Solomon Islands’ elections are notorious for generating civil unrest, either before or after, or both. China’s track-record

for putting down dissent and unrest is as fearsome as it is infamous. It is not hard to conceive that some civil disturbance could be initiated, which generates a state of emergency, the need for a Chinese security presence ‘to protect the safety of Chinese personnel and major projects’ and the delay of elections. This is an extreme scenario and would be a very bold stratagem, putting at risk regional stability and indeed, the Pacific Games.

The reaction of the public to any such situation is difficult to predict, but the tensions that caused the 1998-2003 Tensions remain under the surface and cannot be underestimated.

n Next Chapter

If these conditions around the flash points unfolded, the infrastructure industry in Solomon Islands as we know it would cease to exist. Economic activity and foreign investment would take a severe hit and the economy would be re-fashioned on new terms. The uncertain political situation could grind on for years.

While severe in consequence, the likelihood of this scenario playing out remains ‘low-possible’ – overall a medium risk rating. What is more likely is that the strategic competition between China and U.S. allies will see a jostling for government approval of aid and inducements – everything from scholarships to military grade ports.

For contractors looking to take advantage of this, watch for these three trends:

1 Projects under the multilateral banks will introduce procurement rules that make it more difficult for Chinese state-owned construction companies to win work. This is targeted at generating foreign investment from Western countries, increasing engagement with civil society stemming from Western expatriates incountry and burnishing the image of Western-funded aid as being of higher quality.

2 Bilateral aid projects will be single-sourced to companies from the country of origin of the aid (aka, the ‘JICA model’), but this will not necessarily preclude local contractors from being sub-contractors. Becoming a trusted partner will be critical

3 An increasing volume of construction work will place enormous strain on the supply of local materials, the throughput capacity of the ports and accommodation in Honiara, all creating new business opportunities.

The longer-term economic prospects for Solomon Islands along this trajectory are debateable. The real risks of a geopolitical contest are not borne by foreign countries but by Solomon Islands – its people will pay the price for the brinksmanship that has brought on this watershed era.

However this plays out, one thing that’s not in doubt is that every dollar, yen or renminbi granted or loaned towards infrastructure is in the service of foreign interests, not those of the Solomon Islands’ people. Countries don’t have friends; they only have interests. l

Bamboo Ancient materials for modern times

Bamboo conjures images of Asian jungles, rattan furniture, and slow-chewing giant pandas. Used for centuries as a construction material and raw material for producing paper pulp, it is also a food source for humans and animals. Its unique and versatile properties make it both potentially useful and potentially variable as an engineering product. This article explores a renewed interest in the use of bamboo in Fiji and how confidence is growing over its promise to address multi-dimensional issues facing Fiji and other Pacific island nations.

Clumping bamboo efforts

In Fiji, the government and private interests are together developing the framework by which bamboo can be grown as a livelihood, harvested as a construction material and matured in land restoration. It also has uses in furniture making, paper, textiles, food and production of charcoal. Bamboo is able to grow in degraded lands to help stop soil erosion, while restoring soil nutrients. The Fiji Bamboo Association (FBA) was established in 2019 with a vision to combine the efforts of the bamboo industry and transform people’s livelihoods and environmental sustainability in Fiji. In 2020, the Fijian government joined the International Bamboo and Rattan Organisation (INBAR), in a clear demonstration of its intent to invest in deriving the benefits of bamboo. Through INBAR’s support and collaboration with the Pacific Islands Development Forum, the Fiji Bamboo Centre will be opened in 2023, under the Ministry of Forestry and guidance from FBA, to co-ordinate all “bamboo-related activity” in Fiji.

Fiji’s Ministry of Women, Children and Poverty Alleviation is also committed to seeing the success of the industry. In 2017, then Minister, Hon. Mereseini Vuniwaqa, articulated at COP23 how bamboo can be “used to create diversified income streams for particularly vulnerable groups, such as women, as well as create resilient… housing.” Bamboo can therefore play a role in the empowerment of women, children and the rural poor, as well as adaptation and mitigation of climate change.

Bending to the climate

This is a welcome return for bamboo in Fiji, after Chinese efforts in the 1970s faltered due to lack of interest and investment. The situation has now reversed, driven chiefly by climate change concerns. In the construction industry, efforts to reduce carbon released by harvesting timber, emissions from steel and concrete manufacturing, reducing shipping emissions, and reducing soil erosion are supported by the economics of producing local, sustainable alternative products. Given Fiji’s topical climate, bamboo is an obvious choice.

Bamboo exhibits material properties which make it well-suited as a disaster-resilient building material. Its bending strength enables it to deflect under wind loads without breaking and to absorb earthquake energy. This could reduce the cost and recovery period of natural disasters, as buildings survive and do not have to be rebuilt.

Fiji has one native bamboo species (Schizostacyum glaucifolium) and up to 20 others. Research is underway to determine the most appropriate bamboo species to use as a sustainable material. FBA are looking at introducing seedlings of different species into the country that are better suited for the construction industry and for food, while cognisant of avoiding invasive species.

Bamboo ticks a lot of boxes for a range of donors too – climate resilience, female participation, private sector growth, carbon storage, Sustainable Development Goals – making it ideal for attracting funding.

Putting in the ‘boo

Using bamboo to make paper and chairs may be relatively straightforward, but can it be used as a construction product? A kava bar is one thing, but a government building, conference centre

or multi-story tower? It’s not in the building code, so which standard is applicable to the use of bamboo?

FBA presented at the recent Fiji Construction Industry Council’s annual conference on the uses of bamboo in construction to try to address some of these concerns. The key to using bamboo in construction, at a scale beyond simple shelters, is to reduce the variability of its properties. To engineers, variability means unreliability. The way to reduce this variability is already well known to structural engineers who use timber for large construction –composite or laminated members.

Composite bamboo is a manufactured product which uses a combination of bamboo fibre and epoxy. Composite can be produced in shapes and sizes to suit engineering applications such as beams, framing timbers and flooring structures. It can also be used for architectural applications common to timber, such as flooring and paneling. The use of bio-epoxy, produced from algae, can make this product completely sustainable.

Bamboo can also be used as beams, rafters and columns in its natural form, but, similar to regular timber, needs to be treated with boric acid to prevent termite attack.

Standards need to be developed and implemented to enable the production industry to be regulated and for specifiers and builders to gain confidence in the use of bamboo. Mark Borg, FBA’s CEO spoke with PT and described the situation, “Country building codes need to be updated with guidelines on the use of bamboo in construction. We do not have to reinvent the wheel here either… many countries have already done so and we just need to adapt these to our own circumstances.”

Borg is right – many countries, including tropical countries, East Asian countries and those who identify as Small Island Developing States (SIDS) – have adopted bamboo as a solution to various challenges. East Asia has a very mature industry and could be studied for applicability. International standards exist for the structural design and material testing of round (culm) bamboo, to meet minimum requirements, for structures up to two storeys (7m) in height. These have also been codified in some countries and Fiji would do well to expedite an update to the National Building Code to include specific requirements for the design and use of bamboo.

The new cane?

The bamboo industry is worth USD 60 billion globally. If Fiji can develop the agriculture and manufacturing to grow, harvest and produce bamboo building products, a global market awaits. The post-colonial evolution of the sugar cane industry in Fiji and the just use of traditional land may be an avenue for good bamboo farming practice. Government policy to support and protect the industry will be essential to producing bamboo at scale, for domestic use and export. Business growth to support the sector will also expandconsider treatment and drying centres as well as transportation of input and output products.

Solomon Islands uses more bamboo than Fiji, but the industry there is not harmonised. Tonga is a member of INBAR and would likely be a willing ally in any joint Pacific efforts. Given the universal challenges facing the Pacific and the potential presented by bamboo, a collaborative approach to technology sharing, manufacturing centres and decentralised participation will distribute the benefits broadly. In time, perhaps bamboo will conjure images of Pacific resilience and partnership. l

GOC, NHA, SINU sign Venue Use Agreement

THE GAMES Organizing Committee (GOC), the National Hosting Authority (NHA) and the Solomon Islands National University (SINU) this month, signed a Venue Use Agreement that would allow for the use of SINU facilities before and during the 2023 Pacific Games.

As part of the agreement, SINU had granted the rights for the use of its three campuses namely; SINU Kukum Campus, SINU Ranadi Campus and SINU Panatina Campus to be used as venues to conduct Games events come next year’s Sol2023 Pacifi c Games.

Speaking at the signing, SINU Acting Vice Chancellor Dr Jack Maebuta said that SINU is committed to supporting the Solomon Islands Government deliver a successful 2023 Pacific Games.

“The willingness and participation of the Venue Use Agreement is a testament and demonstration of our support to the Solomon Islands Government to successfully host and deliver a memorable legacy and the best Pacifi c Games ever.”

Dr Maebuta said that through the agreement, SINU has provided to the Pacifi c Games around 40 to 50% (percent) of its usable land to construct additional and related facilities for the delivery

of the Games.

He added that SINU is proud to be partnering with GOC and NHA through the signing of the agreement with the aim of helping Solomon Islands host the best Pacific Games ever to be held in the region.

NHA Executive Director, Christian Nieng said that the signing marked yet another key milestone that the GOC.

Mr Nieng added that SINU provides the largest athlete accommodation space needed for the Sol2023 Pacific Games, whilst also acknowledging the progress of all Committees under NHA – labelling preparations as being on track.

GOC Board Member, Mr Robert Iroga thanked SINU for its commitment in partnering with GOC and NHA – labeling the partnership as timely and critical.

“GOC sees this partnership with SINU as timely and critical towards delivering a successful Games next year,” he said.

Mr Iroga meanwhile, also revealed that GOC is expecting all venues to be completed by June, 2023. l

Left to Right: NHA Executive Director Mr. Christian Nieng and GOC CEO Mr. Peter Stewart formalising the agreement with SINU Pro Vice Chancellor (Academic) Dr. Jack Maebuta as SINU Pro Vice Chancellor (Corporate) Mr. Shadrach Fanega looks on.

Friendship Hall Opens Doors

PRIME MINISTER Manasseh Sogavare has officially opened the country’s first ever Multi-Purpose Futsal facility, the friendship hall on November 1 2022.

The opening of the Friendship hall will not only boost the moral and training experience of current and upcoming futsal players but will also complement training programs for other indoor sports including volleyball, basketball, netball, and more.

Prime Minister Manasseh Sogavare during the opening ceremony also affirmed local sports federations that the facility is designed for multi-purpose sports, which means it can also accommodate other sports competitions, trainings, and public events.

The National Hosting Authority as the current custodian of sporting facilities that are being built in preparation for the Sol2023 Pacific Games, will be co-managing the facilities with NSC and is keen on opening these facilities to the sports federations to enhance their preparations.

Since the opening of the Friendship hall this week, the NHA has already received several requests for the use of the facility for upcoming sporting events including the Bulk Shop Futsal finals which are expected to take place on 4 November 2022. l

PM acknowledges 2008 Kurukuru Futsal team

THE SOLOMON Islands Prime Minister Hon. Manasseh Sogavare has acknowledged the original 2008 Kurukuru Futsal squad and coaches that have trailblazed the highest level of sportsmanship by representing Oceania region in the FIFA Futsal World Cup on several occasions.

Prime Minister Sogavare gave such remarks during the official opening of the Friendship hall multi-purpose futsal stadium at Panatina, on 1 November 2022.

As a token of his appreciation towards the futsal stars, Prime Minister Sogavare presented each member of the squad including their coaches with sealed envelope tokens of SBD$1,000 each.

In response, team coach Mr. Dickson Kadau said the once Kurukuru golden boys turned men, value the kindness and exemplary humble gesture exerted by the leader of this nation, as a sign of recognition and appreciation to their national contribution and are very grateful for the thoughtfulness.

The opening of the Multi-Purpose Futsal hall marks a huge milestone in the development of Futsal in the country.

The National Kurukuru Futsal Team has been carrying the National flag through several FIFA world cup campaigns for 14 years despite not having any proper training facility, and the opening of the Friendship MP Futsal Sports Complex to have a new futsal home is a dream come true for the team. l

Recent Table Tennis Competition at Friendship hall. Since opening several organised sports and programs have already been facilitated at the Facility.

PM Sogavare Awarding one of the original 2008 futsal players.

Pacific Games Council and Chef De Missions Visit Sol2023 Games Venues

THE SOL2023 Games Organising Committee (GOC) have facilitated a one-day site visit to all the games venues and currently constructed games facilities for the President and members of the Pacific Games Council Board and all Chef De Missions and Team Managers from the 24 Participating countries to the 2023 Pacific Games next year.

The sites tour led by the GOC Chief Executive Officer Mr. Peter Stewart and GOC Operations Manager Jack Smith, together with Villages Manager, Mr Joseph Iniga, and Venues Manager, Mr Pongi Tangia, took place on 19 November 2022.

The tour covered the games villages including: Don Bosco Technical Institute, St. Josephs Tenaru school, SINU (Ranandi and Kukum campuses) and St. Nicholas school. The tour also involved visits to games venues including: The Honiara Golf Course, the new Solomon Islands Football Federation (SIFF) Academy, KGVI East and West sports venues and the friendship hall.

In a statement former Chef de Mission for the Solomon Islands who also accompanied the tour Mr. Ronald Bei Talasasa Jr said the visit really gave him a sense of pride and nationalism seeing the unprecedented level of commitment and investment the government has put into sports development in preparations for the Games in November next year.

“I left the country, Solomon Islands, in mid-2019. When I left, Panatina fields up to KGVI grounds, opposite the Taiwanese farms were all grass lands with the only structure there was the Allan Boso complex.

“On my return on Wednesday 16 November and more particularly

the visits by the Chef de Missions on Saturday 19 November, I couldn't believe my eyes. All the grassland is gone. I saw only concrete slubs barricading the grounds and metals in the skies. Unbelievable!” Talasasa uttered.

“It only confirms my apprehensions that when governments are fully behind sports, sports catapults to a higher level.”

“It is no joke and not simple that the facelift in preparation for PG 2023 has taken many miles of steps ahead of our time. It was brought about because of a vision and a determination by the current leadership in government to give a future to the young populace. It is the best that any government could offer to our youths and generations of children tomorrow.”

“The country will remember Prime Minister Sogavare and his government for all time. Our generations today should appreciate that,” Talasasa said.

Meanwhile the Chief Executive Officer of the Games Organising Committee Mr. Peter Stewart said “The opportunity to have all the Chefs de Mission on the ground here in Honiara was greatly appreciated by the GOC. It allowed us to clearly articulate the services that will be provided to each team and to address any issues they may have, well ahead of the Games in November next year.”

The visiting delegation were here in the Honiara to assess the country’s preparation for the games in relation to the facilities, accommodation and all operational aspects of the games – 1 year out from the Games Opening ceremony. l

Pacific Games Council members and Chef De Mission visit games venues.

NHA to maintain Ownership of Constructed Venues post Sol2023 Games

PRIME MINISTER Manasseh Sogavare has opted that the Sol2023 Pacific Games venues and facilities both completed and still under construction, will remain under the custody of the National Hosting Authority until the Games are successfully held in November 2023 and then NHA will distribute non-financial assets appropriately.

In his official remarks during the opening of Friendship Hall this week, Prime Minister Sogavare said the

NHA will work in partnership with the National Sports Council to ensure these facilities are properly co-managed and looked after.

This will be the progressive plan post 2023 where the NHA will be able to strengthen the capacity of the NSC to be able to completely manage the facilities in the years ahead.

Currently the Friendship Hall gifted to Solomon Islands government by the Indonesian Government is the first of several venues to be completed and

looked after by NHA since the opening.

The NHA and NSC are looking at utilising these facilities for the preparation and development of athletes in preparations for the pacific games.

The Opening of the friendship hall marks the start of more games venues and facilities being built for the 2023 pacific games and where time permits, open to public before the venues are handed over to the games organising committee to fit them out for the 2023 Pacific games purposes next year.

Gov’t, HCC discuss Safe and Green Games

THE GOVERNMENT Services Integration Committee (GSIC), of the Office of the Prime Minister and Cabinet, held fruitful discussions with key Government officials from Government Ministries and the Honiara City Council on the Safe and Green Games Strategic Action Plan.

Discussions focused on the Safe and Green Games Strategic Action Plan as a whole of Government Approach encompassing all government ministries, HCC and stakeholders to support the Pacific Games 2023.

The discussions included key activities in the Safe and Green Games including the critical role of HCC as the Host City.

Honiara City Clerk Justus Denni said HCC is fully aware of the prominent role to play in preparations in the lead up and during the Pacific Games 2023.

Denni said HCC will continue to focus on its normal service delivery but will need further support from the National Government and other stakeholders to double its eff orts during the Games.

He added there are plans and constraints but he is hopeful and looked forward for support to prepare and host the Pacific Games in 2023.

Permanent Secretaries and Deputy Secretaries from other Government ministries also contributed to the discussions on the specific and respective roles each ministry will play to support the preparations and hosting the Pacific Games 2023.

Chair and Coordinator GSIC-PG2023, Benard Bata’anisia urged all the ministries, HCC and stakeholders to work and partner together in preparations.

Contributions to discussions during the meeting were from key officials from the Government ministries including Ministry of Forestry, Ministry of Culture and Tourism, Ministry of Health and Medical Services, Ministry of Infrastructure Development, Ministry of Police, National Security and Prison Services, Ministry of National Development Planning and Aid Coordination, Ministry of Women, Youth & Children’s Affairs and HCC.

Follow up meetings will be held with other key stakeholders on the Safe and Green Games Strategic Action plan before launching in November 2022 – a year before the Games.

The 17th Pacific Games will be held in Honiara, Solomon, Islands, from 19 November 2023 to 2 December 2023. l

NHA to maintain ownership of built facilities. (KG West End Sports park under construction).

'CONNECTING THE UNCONNECTED AND REACHING THE UNREACHED'

Connect PNG ProgrammeFinancing and Progress Update

HON. SOLAN MIRISIM, MP Minister for Works and Highways

THE Marape-Rosso Government's vision to achieve 100% Road connectivity in PNG by 2040 has just received a funding boost of K300 million. This additional funding will maintain good progress on ongoing works under the Connect PNG Economic Land Transport Infrastructure Development Programme, popularly referred to as the "Connect PNG Programme". The additional funding will also kick start upgrading works on 6 more new critical sections of the national road network on the Manus, East-West Highway, the New Britain Highway (East & West New Britain), the Magi Highway {Central & Milne Bay), the Ramu Highway (Madang & Morobe) and the Coastal Highway (East & West Sepik sections).

The Minister for Works and Highways - Hon. Solan Mirisim, MP reinforced the government's strong funding commitment for the Connect PNG Programme, during these difficult economic times. The Marape-Rosso Administration has appropriated K600 million for capital works in the 2022 budget. This includes K300 million for provincial and district roads under a Subnational Roads Development Programme, separate from the Connect PNG Programme. To date, all of the 2022 funding have been released in full aa intended according in the 2022 Annual Work Plan.

Minister Mirisim expressed his satisfaction on the overall

performance of the Connect PNG Programme, attributing the programmes exceptional progress, to the government's strong leadership and commitment, and the huge support from Donors and Development Partners, with ongoing guaranteed funding support.

Minister Mirisim also commented that the government recognizes the important role transport infrastructure plays in providing connectivity for our urban and rural communities, businesses and industries. "Good roads bring a conducive environment that encourages investment in socio-economic development. Roads, in particular, play a crucial role in encouraging socio-economic development and progress of the country, as land transport accounts for over 80% of national freight and passenger traffic volume."

"Despite the important role roads play in the development our country, our existing road network has deteriorated because of neglect over the last 20 years and it has steadily fallen into a state of disrepair due to lack of maintenance. The poor road network condition has become a brake on our economic development. Access to markets and service delivery have become much more difficult, travel time and vehicle operating costs for road users, are

much higher than normal."

To address the challenge of recovering the condition of the road network and improve road connectivity for our citizens and businesses, the Marape-Rosso Government approved in 2020, the 20-years Connect.

PNG Economic Road Infrastructure Development Programme 2020-2040. The total cost for the Connect PNG Programme is K20 billion.

The Connect PNG Programmes long-term goal is to obtain '100% Road Connectivity for PNG by 2040'. In the mediumterm, the goal is to achieve a road link between the National Capital District with Morobe, Madang and the seven Highlands Provinces, before the country's 50th Independence anniversary. Minister Mirisim pointed out that "The achievement of this road linkage by the September 2025 target date, will symbolize our national development, cohesion and unity over the past 50 years of independence, as well as achieve a significant development milestone, by connecting our two biggest cities for the first time. This target will also enable our people on the mainland to travel affordably, to celebrate PNG's Golden Jubilee in Port Moresby or their home province, as they wish.

In 2021, the National Parliament passed the Connect PNG (Implementation and Funding Arrangements) Act 2021. The

purpose of this Act is to legislate a guaranteed minimum funding for the Connect PNG Programme, equivalentto 6.5% of the annual budget, each year. Based on Treasury's medium-term budget forecast for 2023-2027, the minimum funding translates to around Kl.4 billion annually, for the Programmes Phase 1 period up to 2027, inclusive. "The Connect PNG Programme is Prime Minister Marape's 'flagship' development programme. I am therefore very thankful for the support and the importance the Prime Minister has accorded to the Programme since his Cabinet approved it in 2020."

The Programme aims to rehabilitate and reconstruct 16,500 kilometers of economic roads and 1,000 meters of bridges and other drainage structures that have deteriorated over time due to lack of regular maintenance. The Programme is also constructing Missing Link Roads (new economic road links) totaling around 4,200 kilometers. Currently the Missing Link section of the Trans National Highway between Aseki in Morobe Province and Epo in the Gulf Province is under construction. The completion of this road section will establish the strategic connection between Port Moresby and Lae City.

The Connect PNG Programme is being implemented in three Phases. Phase 1 is from 2020-2027 at K7.98 billion.

When the Marape Government came into power in 2019, there were DoWH was implementing over 230 contracts around the country. The estimated total value of these ingoing works inherited from the previous administration was K3.4 billion. All of these works were absorbed into the Connect PNG Phase 12020_2027 Programme Target. Since the inception of the Connect PNG program in 2020, the Marape Government has completed road works of approximately K3 billion between 2019 and 2022. This expenditure comprised Kl.93 billion for the upgrading and rehabilitation of 2,000 kilometres of roads and another K500 million comprised arrears for unpaid contract claims inherited from the previous Government between 2012-2018. In addition, there was an additional 3,200 kilometres of both National Roads and Sub-National Roads procured and implemented under the Marape-Rosso Government in the same period. Some of these completed major road works include:

(i) Upgrading to 4-Lanes Lae-Nadzab Section of the Highlands Highway at K300 million. This Contract is currently on Phase 2 from 9 Mile to Yalu Bridge.

(ii) Rehabilitation and Upgrading of 430 kilometers of the Highlands Highway from Nadzab to Mt. Hagen at close Kl.0 billion.

(iii) Upgraded to 4-Lanes Kagamuga-Keltiga Section of the Highlands Highway for K286 million.

(iv) Construction of Gulf-Southern Highlands Highway (12 kilometers) Missing Link Section for Kl00 million.

(v) On-going Construction of 141 kilometers of Missing Link Section {Aseki in Morobe to Epo in Gulf) of the Trans-National Highway with the PTO Equipment of the Department of Works and Highways, under 'Force Account' arrangement.

(vi) Construction work on-going for more than 47 kilometers of Missing Link Road between Central Province and Milne Bay Province for K14 million.

(vii) Construction of 100 kilometers of Missing Link Road (Finschaffen Highway) from Lae to Finschhaven for K287 million.

(viii) Rehabilitation of Boluminisky Highway from Kavieng to Namatanai.

(ix) Upgrading to seal of the New Britain Highway from Kokopo to Kerevat in East new Britain to be continued with the

construction of the Missing Link between East and West New Britain to Kimbe.

(x) Rehabilitation and maintenance of 126 kilometers of the Hiritano Highway for K77 million.

(xi) Construction of 12 bridges on the West New Britain side of the New Britain Highway.

(xii) Supply and construction of 1,000 meters of rural standard bridges across the 22 provinces and districts.

(xiii) Other Missing Link Roads under the Connect PNG Programme include Madang-Gulf Highway, Trans-fly Border Highway from Kiunga to Aiambak section, Tabubil -Telefomin, and the Trans Fly Border Highway from Oriomo (Daru Coast) to Wipim Station section.

For the 2022 to 2025 period, DOWH will commence KS.6 billion worth of road works programmes representing the biggest capital works programme ever undertaken in PNG. This includes Kl.3 billion Bridges Rehabilitation and Replacement Programme on the Highlands Highway to complement the ongoing road works between Nadzab in Morobe and Kagamuga in the Western Highlands Province.

"I'm very thankful to the government for the K150 million funding to improve vulnerable sections of the strategic and critical economic Highways, such as the Manus Highway, Sepik Highway, Magi Highway, Hiritano Highway and Trans-National Highway. Furthermore, the government has approved an additional K140 million in outstanding counterpart funding for the ongoing Highlands Highway SHHIP program to improve the most critical sections of the Highlands Highway in Simbu Province, Daulo Pass and Kassam Pass in the Eastern Highlands Province and

subsequently improve overall value and quality of the highway."

The benefits of improved road conditions and increased road connectivity increases mobility for the majority of our people, mainly the rural majority. It also increases freight both in terms of volume and frequency. With increased mobility and freight come greater opportunities for socio-economic development and participation in the formal economy by the majority of our people. Good road conditions and connectivity further result in positive multiplier effects such as better accessibility to markets, employment, schools, health services and additional investments. In summary, poor road conditions and the lack of road connectivity have a negative or adverse impact on the economy in general and on the lives of the people. Improvement of our roads will decrease the overall cost of transport, which in turn will help decrease business costs and increase opportunities for new investments and business growth in all sectors of the economy. At the same time, the cost of delivering public goods and services decreases.

I, therefore, acknowledge and thank the Marape-Rosso Government for its bold decision in investing in this 'flagship' Connect PNG Programme, to ensure that our existing road networks are improved whilst our unconnected places and people are connected by roads. The Connect PNG Programme is a 'game changer in the development of our country.

Papua New Guinea must be connected by safe and reliable roads by 2040 and must have all roads in good conditions so that we can improve our socio-economic development indicators and improve our position on the Human Development Index and elevate ourselves to a middle-income country. l