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close this bookThe Courier N° 133 - May - June 1992 - Dossier : Environment and Development - Country Reports - Côte d'lvoire - Papua New Guinea (EC Courier, 1992, 104 p.)
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Democracy: Putting principles into practice

Democracy is emerging in the countries of Africa rather as independence did. Whereas some states in the 1950s and 1960s had to fight hard for their international sovereignty, others were proffered it, as de Gaulle put it, like a poisoned chalice. This to a very large extent falsified the meaning of independence inside these newly independent countries and led them into making national and international political choices which, even on matters of general agreement such as the anti-apartheid campaign or just the aims and means of economic development, went down different paths.

Democracy has arrived in much the same way. After vainly resisting the 'injunctions' delivered at La Baule, the African States ended up in mourning, with the multiparty system seen as an 'external vision' of democracy and a 'luxury which the African countries could not afford'!

But realism lives on, of course, and the choice between two evils had to be made. It was democracy with aid or the status quo without. They opted for the principles, not always a painless process... and now they have to be put into practice.

Cd'Ivoire was not just standing on the sidelines while all this went on. Despite one or two national and international options which have been major talking points, in the space of 30 years it has contrived to build up a solid, food-producing farm sector and a communications infrastructure network, both en viable bases for sustained industrialisation in the long term. Once a 'second-rank' state in comparison with Senegal, which was the hub of the region in the colonial era, it took a leaf out of Dakar's book and became the promised land for virtually all the peoples living in that part of the world. This was real economic success. It was relative, certainly, in that the income gap between those who were productive and those who were not remained wide, but it was a feather in the cap of three decades of Houphouet-Boigny government - and a help in the mess the country finds itself in today. And the Ouattara Government's new economic policy aims to right the wrongs of misguided management and put the economy back in the hands of the business sector, with privatisation on every front (in banking, energy, farming etc) and clear confidence in private management (see statements by Alessane Ouattara, the Prime Minister, Lambert Konan, the Minister of Agriculture, and Professor Ekra, the Minister of Health).

But as the Prime Minister himself agrees, economics and politics cannot be kept apart, and the ongoing economic reforms will only work if there are the proper political structures to go with them. As far as principles are concerned, the single party system is a thing of the past and the big question now is the day-today running of democracy and the real role of the political parties, the administrative bodies and the trade unions which contribute to that democracy. The democratic good faith of Dr Ouattara cannot and should not be doubted. But how much room does he in fact have for a proper State of law when both the (albeit changing) administration and the (solidly established) army are the product of a regime which put itself above all criticism? How much room does he have with the clumsy manœuvres of ill-structured opposition parties armed with no credible programmes reflecting the profound frustrations of years devoid of democracy ?

The recent troubles in Cd'Ivoire, the Government's questionable way of dealing with them and the irresponsible reactions of the press and the General Secretary of the Party, which have only made things worse, show that there is still a huge gap between the principles of democracy, which have been adopted, and the practice of it-for practical democracy means the separation of powers and the drawing of a firm line between the work of the Government and action by the forces which support it. No doubt the sudden switch to a process accelerated by the international political climate and the nation's very serious economic problems has something to do with this straying from the path. The cost of living in Abidjan and the country in general is very high and, as all over Africa, there are clouds on the horizon, particularly for young people.

However, these economic and political difficulties must be seen in relative terms. This is an enviable situation in comparison with other African States with similar resources, or indeed some with wonderful mineral wealth and oil and apparently brighter futures in store. And when it comes to the basic freedom of ordinary people within its frontiers, this is a country which has a lot to teach others-and not just in Africa either.

Cd'Ivoire's big problem today, over and above the crucial management issue, is how to build a thriving democracy which will safeguard and develop fundamental freedoms and give the nation an economy which creates employment and brings hope to the most vulnerable members of its population, the young people.


Interview with Prime Minister, Alassane Ouattara

'It will take work to reach the level of other countries'

In this interview with the Courier, the Prime Minister of Cd'lvoire explains the actions of the Government, during the current period of political and economic uncertainty.

· Prime Minister, I should like to start with current events, if I may. I should like to ask you to look beyond any judgments made in the heat of the moment about those events, and beyond the violence, open or latent, affecting Cd'lvoire at the moment and say what you see as the root cause of this trouble. Some analyses, for example, suggest that no-one has put any' blame on State powers based on a single-party system, particularly when it comes to the administration, the State media, the army and the police force.

-I am deeply sorry about the violence in February. But I should like to make clear once again that Cd'lvoire has always been a State of law, that it has had a Constitution providing for a multiparty system since 1960, that it has had pluralist elections, albeit in the framework of a single party, since 1980 and that a multiparty system was actually set up in April 1990. So as far as we are concerned, your general analyses don't apply to this country.

'The State is working better and more efficiently'

We completely overhauled the administration a year ago. People now feel younger, the authorities are more dynamic and the private investors who come to see us here agree that the State is working better and more efficiently. Violence is something we deplore, because we set great store by a State of law. We wish to continue to nurture and develop the pluralist democracy set up, as I said, in April 1990-and we shall give it all we've got. But it is also the authorities' duty to protect people and property so the Government will do whatever is required here too.

· What about the other things - the army and the police and the State media:' Have you completely liberalised in these areas too ?

-When it comes to the media, Cd'lvoire is one of the rare countries in Africa south of the Sahara to have two public TV channels without any State interference in programme management.

The army is a professional body whose job is to protect our borders and ensure that the citizens feel safe from the problems which some of our neighbours have had for many years and which have led to a large influx of refugees coming here. So as far as we are concerned, when it comes to the army and the press, the problems you mentioned don't apply to this country.

Relaunching the economy

· What major reforms have there been since you became Prime Minister two years ago ?

-The answer to that could take a very long time, but I shall do my best to summarise. First of all, I was made Chairman of an Inter-Ministerial Committee on Economic Affairs in April 1990 and Prime Minister in November of that year, so I have indeed been coordinating the nation's economic management for nearly two years now.

The guidelines of our economic policy are very simple-to get our production apparatus off the ground again despite an international economic and financial crisis which of course has repercussions at national level too. We all know what caused the crisis. The terms of trade declined suddenly. In particular, cocoa and coffee prices dropped by two thirds in three years, depriving us of important export revenue. In spite of that, 1 think our policy has contrived to stop the decline in public finances and even stabilise them, because, in 1990, we cut the public sector deficit by 5% of GDP. I don't know any other country in the world which has managed that. If the industrialised countries manage a point or half a point of GDP, the Group of Seven congratulates them. And we managed five points in 1990 and we think we made almost two or two and a half points in 1991 ... We had to do it too, so that we could strike a fresh macro-economic balance in our budget and our finances.

While applying this policy, we also ran sectoral programmes to make the economy more efficient. We had financing and loans from the African Development Bank and the World Bank to help us here, particularly with farming and energy and other schemes. These programmes went well and recently we overhauled the administration and developed human resources, with technical and financial support from our external partners too. We got one of the loans to improve competitiveness in the financial sector, because the banking system had also been hard hit by dwindling cash flow. It was impossible to cash a cheque at one stage because the banks had no liquid assets and several of them had to close down. But all that is more or less behind us now.

The stabilisation of sectoral restructuring is going to mean we can start moving along the path to strong, lasting growth. That is one of the aims of our current privatisation policy, whereby we can release new, extra resources both to maintain our infrastructure-some of the best on the continent-and go in for new, productive investments. We are now in the active phase of privatisation, a committee is working on a range of dossiers and 1992 will see a series of former State and semi-public firms go private. All that will help get the Ivorian economy off the ground again.

· Boosting export trade is one of the keys to economic revival and growth. What outlets are you aiming for with a strong export policy?

-As you know, cocoa and coffee were more than half the country's export trade until very recently, but they only brought in just over a third of our export revenue in 1991.

We have gone into diversification in a big way with cotton, palm oil and bananas-products also destined for markets in the North, if you like-but at the same time, industry has developed a great deal and we are starting to try and capture regional markets. The countries around us like Ivorian products. We now have an aggressive policy here and the drive for regional integration is a help.

'Competitive with everybody'

· The policy of growth and competitiveness which you want to apply is taking place against a background of poor domestic demand and heavy competition from abroad and particularly from the countries of South East Asia. How are you going to cope with these two handicaps?

-Competition from South East Asia is everybody's problem, not just Cd'Ivoire's. We want to be competitive with everybody, on regional markets and international markets alike. Our idea is to be universally competitive-which is why we have a structural adjustment and competition plan which has gone a long way to freeing trade and distribution. Things are going well here and the figures bear this out, because our exports are still going up in spite of the crisis.

It is growth which will make domestic demand grow. I do not share the view of economists who think demand has to be created by injecting money, because, ultimately, all that leads to is inflation or a deficit in the balance of payments. That is obvious from one or two of our neighbours and countries a little further afield which have an annual inflation rate of 1 000% or 2 000%. I do not know what benefit people with modest incomes may derive from recovery based on demand. As we see it, recovery has to be based on investments and exports.

· Are you counting on national investments first and foremost or on investments from abroad ?

-Savings can be national savings or foreign savings. It doesn't matter. What we want is maximum savings so the investment rate can go up.


· But they still say that Ivorians don't invest enough at home, so perhaps they have no confidence in their own economic situation. You know better than anyone that foreign investors will only invest their money if they think nationals believe in their own Government's investment policy. What do you think about that?

-I'm surprised to hear it, because, while there are foreigners coming here to invest, I can see no reason for Ivorians not to believe in their country. I don't have the exact figures, but we have plenty of small and medium-sized firms, young Ivorians using their savings and running up debts with the local banks to make a go of their businesses.

· So what about the report that the Ivorians have a lot of money abroad and, if only they could spend some of it on investments in their country, the economic situation would improve far more quickly ?

-You hear so many stories. I should like to see the statistics on the Ivorians' assets abroad. I heard that tale in 1990 when I arrived at the head of the Government and asked people to make an effort. 'Listen', they said, 'get them to bring the capital back'. I don't know where all this capital was. But what I do see is that activity is getting going again now and that the privatisation programmes are generating enthusiasm among foreigners and Ivorians alike and I think we should continue along these lines. If by chance there were a mass of resources abroad, I think the economic policy we are following at the moment should provide adequate assurance for all and sundry.

Exports halved in two years

· Where does the Government stand on the coffee and cocoa negotiations which have now reached stalemate ?

-We hope to see an agreement, of course, and we hope to see the work and the efforts of the peasants in the producing countries taken into proper account. But these are negotiations and the producers have to get on with each other. Our position is one of several among the producers and we are trying to find as much common ground as possible so as to improve our chances of success. Fluctuation is behind some of the current problems I have already mentioned. I cannot think of any developed nation which could have had its exports cut in half in two years without experiencing very serious social upheaval.

· Are you for an agreement with or without a quota ?

-These are under negotiation and the important thing is that we have specialists discussing in London. A great deal of open-mindedness is needed to reach agreement and the sooner we reach it the better.

Delays in disbursement

· Have you any criticism of your cooperation with the European Community ?

- We hope people will notice the efforts being made in this country and that the procedures are speeded up so the payments come in time to relieve our problems and back up the drive we are making. I have no special criticism of the Community. Overall, ours is a relationship of a developing country with an industrialised country, in which each is trying to take account of the constraints of the other. Implementation should perhaps be faster. Our experience leads me to say that payments are sometimes very, very slow.

· Is this the Community's fault, do you think ?

-Of course it is, because we ourselves have tried to be up to date with our dossiers for some time now. You can check it with the World Bank and the International Monetary Fund, where there isn't the same slowness and difficulty we have with the Community.

· So how do you account for the fact that implementation of the 5th Fund is only now coming to an end although the 7th Fund started up nearly' two years ago ?

-Things may well have been slow in the past, but I think we have done something about it.

· Parity of the CFAF, and the Ivorian CFAF especially, is a handicap for some of your exports. Do you think that, from the Community' policy any/e, you will eventually have to review where the CFAF stands in relation to the French franc and perhaps to the ECU, the forthcoming European currency?

-The CFAF is a sound currency. It is the only convertible currency on this continent and even in the developing world as a whole and having a strong currency isn't a weakness, you know, it's the opposite.

· A strong currency in a weak economy'?

-We haven't got a weak economy. With declining terms of trade and in times of soaring prices, we should perhaps have adjusted the parity of our currency. But we didn't. We opted for stability. The terms of trade are deteriorating further at the moment, but we are maintaining the stability of our currency because it means we can contain and even stabilise our prices. That is essential for us here in the poor countries.

We are in a monetary union and the monetary policy is not the business of just one State-even Cd'lvoire.

As I said, we are restructuring the economy and it is going well. France and the international institutions are backing our competition programme geared to improving exports, so things are going well. The matter of parity of the CFAF is a matter for France and the French treasury too and as long as all the parties think the present arrangements are in their interest, I think things will continue as they are. I don't find your questions on the CFAF difficult. I am a banker, as you know, and sometimes it is right to manipulate the exchange rate and at other times it is pointless. Furthermore, in the case in point, it would take a joint decision by France and the 14 African countries making up the franc zone.

· How do you see the present broader political situation in the African countries and, more generally, what do you think about the way they are developing?

-I think it is true that the countries of Africa are coming up against all kinds of problems and I persist in thinking that economic constraints are behind many of them in many places. As you said, economic problems and political problems go together. In our case, if we had not lost between a third and a half of our export revenue and a third to a half of our budget revenue as a result, we would not have had so many problems and would have had better conditions in which to implement our political reforms. So they go hand in hand. The economy has to look up before the political reforms can go any further.

'Reforms will never be successful in a poverty situation'

· Political problems are currently overshadowing economic reform, aren't they? What is the answer? Tackle the economic issues first or find a political basis on which to tackle the economic reform ?

-In running a State, I think, there is no such thing as an isolated subject. Politics cannot be separated from economics and those who have tried to separate them have soon realised it doesn't work. There are countries which have set up what are called national conferences in the mistaken belief that this would solve all their problems, only to find six months later that they couldn't pay their civil servants or their students' grants and that the people who claimed to be going for democracy were on strike. So economic issues too are central to all this and I think it is wise to continue with both together. I am not a partisan of aid. I prefer to see things achieved through savings and trade. Yet the more the industrialised countries realise that they have to give economic and financial support to the poor ones, the better the political reforms will be, because we cannot convince people who are living in poverty if they do not believe in what we are doing and reforms will never be successful in a poverty situation. Many African countries are in total poverty at the present time, alas, but they really have to get it behind them.

· Do you agree with those who claim that the collapse of communism in Eastern Europe will lead to the African countries being marginalised on the international scene because Africa's partners win be looking more to the countries of Central and Eastern Europe than they have done so far?

-We never joined the communist world, as you know. Politically and economically speaking, Cd'Ivoire has always been a liberal country and we believe that we need a competitive economy and that we should go on exporting and developing our trade and be sufficient unto ourselves. What is all this about the marginalisation of Africa ?

I don't know what it means. Does it mean that we want no more aid?

· It's something I have heard plenty of African Ministers say...

-Yes, and I should like to know what it means. Why marginalise? Because there's someone's cake to share? That is not the way we see our national policy. We want to do without other people, like any country which has its self-respect. We want to live from our own national resources and manage our own affairs so as to be self-sufficient in food and trade. Our trade balance is showing a surplus, so, one or two products apart, we do actually produce enough food and we have programmes going to develop the sectors with deficits so we can compete at international level and sell things like everybody else. Talking about marginalisation is always tantamount to holding your hand out. That is no policy of ours.

When it comes to Eastern Europe, perhaps you know that Cd'Ivoire is one of the four or five countries where Russia has kept an embassy. I see these new countries as an opportunity to develop trade rather than something that will marginalise Africa. It will take work to reach the level of the other countries of the world. Interview by L.P.

Interview with Lambert Konan, Minister of Agriculture

Tax imported meat and rice and boost national output

An important programme of development launched by Lambert Konan, Minister of Agriculture

· Cd'lvoire has a problem with coffee and cocoa, its two main agricultural exports, Minister, hasn't it ? How is the big decline in the price of these commodities- and they are the country's most important ones-affecting production ?

-Coffee and cocoa are indeed the keys to our agriculture, as you say, and they are still the main export products despite all our diversification into palm oil, rubber and cotton. We have industrial plantations and we are developing various food products, but it has to be admitted that coffee and cocoa are still very much to the fore and, obviously, the effect of dwindling prices on a country like ours is dramatic. To be more precise, the drop in prices has affected coffee production badly. Output dropped from 284 000 tonnes in 1990 down to only 200 000 t in 1991. When we were forced to make drastic cuts in the prices paid to the producers, it slumped immediately by almost a third, because the farmers could no longer afford to pay the labourers. There was a complete loss of interest and processing was slack, which affected quality. So, since last year, we have been raising the farmers' morale, telling them that it is quality products from them that will get us back to the top and that we must pull ourselves together.

Cocoa is less of a problem because the purchasing price has stayed a little bit above the price the farmers get for coffee.

· The negotiations for another International Coffee and Cocoa Agreement have come up against the demands of some countries which want quotas and others which don't. Where does Cd'lvoire stand on this?

-Listen-I think it is fair to say that some countries are ideologically opposed to the very idea of an agreement. But we here in Cd'Ivoire believe that we need an agreement and we do not wish to discourage the people who produce. We believe that we need an agreement and that, ultimately, a bad agreement is better than no agreement at all, which is why we support the drive to produce one. The Minister responsible for these issues, Alain Gauze, has consulted a lot of producing countries, friends of ours, and he has been in contact with consumer countries too and I think we are seeing a reversal of the trend at the moment. Some of the countries which are ideologically opposed to agreements are shifting their ground a little bit. But what changes things a little bit today, of course, is, as you say, the arrangements for the forthcoming agreement. Some countries have been looking for purely administrative agreements with no economic clauses, but we in Cd'lvoire do not believe that to be efficient. It is something we have tried out in the past. We, like most producing countries, believe we have to regulate the quantities put on the market -which is why the countries in the cocoa producers' alliance went to Abidjan and made proposals involving setting up a system of buffer stocks rather than quotas. That is what the producers suggest. Some of us think the quota system is too much of a constraint and not more efficient, as I have already mentioned. This is where the discussion has stuck for the moment, but I have every hope that we will find grounds for agreement.

One of the shortcomings of our agriculture...

· Isn't export-oriented agricultural diversification having an effect on food production in this country?

-One of the shortcomings of our agricultural system at the moment, I have to say, is the poor performance we are putting up with our food crops. Although we have no famine as such, it has to be admitted that something like rice, now a staple and widely consumed, is a major weakness. For example, we consume more than 600 000 t of rice every year, but we only produce about half of it. We cover 51% of consumption with the 330 000 t we produce and we can see that, with the towns expanding and pushing up rice consumption, because rice is good and it keeps, we have to make a firm, deliberate move to increase our rice output to self-sufficiency level if we want to avoid import bills of almost CFAF 65 billion (at today's rates) for the almost million tonnes of white rice we shall need come the year 2000.

A rice development plan has been put on the Government's desk and the Government is looking at the finance and everything else involved and we shall soon be giving all it takes to re-establish the country's food balance. There will be two sorts of production-rainfed rice accounting for 80% of output and irrigated lowland rice for the other 20%. This is a deliberate choice because, as you know, although you get a better yield from irrigated rice, it costs a lot more in terms of infrastructure. The year 2000 is only eight years away and we want to be self-sufficient and produce a million tonnes of white rice, the equivalent of 2 million tonnes of paddy, by then. We shall be developing 34 000 ha of lowlands, which will account for 20%, and the other 80% will be improved rainfed rice. We have developed 25 000 ha of lowland plots over the past 25 years, let me tell you, and it may not be easy, but we want to manage 34 000 ha more over the next eight or ten years.

· And your imported rice, I imagine, comes mainly from Asia. Do you import any from any African countries?

-I haven't finished answering your previous question on the measures we are going to take yet. I only dealt with production...

Well, we want the decisions on production and importation to be coordinated. Imports have been the business of the Ministry of Trade so far and production has been in the hands of the Agriculture Ministry and there is a certain dichotomy as a result. The statistics aren't harmonised. You might even say there is competition, harmful competition between cheaper, imported rice and the local rice we produce here, which costs more. We want to put a stop to that and we want to see imported products- because make no mistake about the fact that other countries produce rice more cheaply than we can-taxed and part of that tax go straight into financing local production. Those are the main lines of our policy. The tax added to bring the price of foreign products up would go straight into national production. That is a new and fundamental option.

· That's rather like what happens in Europe wits, the common agricultural policy. The tax on anything produced in the Community is low to encourage producers to trade within the common market and the tax on anything brought in from outside is higher...

-That's exactly what we want to do here. It will cost quite a lot to finance too -an estimated CFAF 1 12 billion to set it up and provide the infrastructure, the storage silos, the industrial processing units and so on-and we plan to cover a good percentage of this outlay with domestic revenue, i.e. tax. The rest will be multilateral aid. The European Community, for example, is giving us a lot of help with this.

· Where do your imports come from ? As you know, other African countries produce rice but don't manage to sell it at home or anywhere else in Africa. What do you think?

-The bulk of our imported rice does indeed come from Asia, mainly from Thailand, Pakistan and Vietnam more recently. But you have to realise that very little of the world rice output, barely 5% in fact, is actually marketed and that the biggest producers-China, India, Indonesia and the Philippines-eat almost all they produce and let only a very tiny amount go on the international market. The FAO has come up with some very reliable statistics showing that there could well be a huge shortfall in rice on the international market by the year 2000, which is one of the things behind our decision to produce rice ourselves. If our rice cannot be made competitive price-wise and quality-wise, we could well see ourselves with supplies that are both unreliable and very expensive by the year 2000. And I should add that we import a small amount of rice from the USA, which gives us the benefit of what they call PL480. It comes as aid, in a way, from the States and we sell it and use the money to develop local production. We are talking to the USA at the moment with a view to increasing the amount of PL480 rice we receive and we want to be able to process it ourselves in order to get our considerable industrial facilities working. Our industrial processing potential is now up past the 400 000 l-mark, but we don't use it all.

Is Cd'lvoire cooperating with other African countries on this:'

-There are two kinds of cooperation with African countries. First of all, on the research front, we have an inter-African organisation called WARDA, the West African Rice Development Association, which has its headquarters here in Bouake in Cd'lvoire and concentrates on different strains and growing methods. We also have working relations with Nigeria in the very high-powered Research Institute in Ibadan. Then all the Agriculture Ministers of West and Central Africa recently met in Dakar and then in Brussels to try and lay the foundations for an economic area in which a cereal market would be prominent. I know that Cameroon' for example, is making a success of growing rice at reasonable cost in the northern part of the country with the SEMRY programme in Yagoua and I am planning to send technicians from my department over to Cameroon to see what they are doing there and how we can develop our cooperation in the rice sector.

· Citrus fruit don't get such a good deal from the agricultural programme, do they... ?

-You are absolutely right. It has been neglected a bit, and wrongly, and the development plan we have just set up will be reviewing all that and we shall be running a major citrus growing and processing operation in central and northern Cd'Ivoire. We want to develop all this in conjunction with other things such as rice or livestock. We want modules for the savannah regions combining trees, food crops and fish farming and herding, with small processing units on the spot.

But you are right. Take pineapples. We set up local processing units which can handle something like 120000 t--and there we made the mistake of thinking too big.

Livestock and competition from imports

· The European Community is financing livestock programmes here, but they either don't work properly or could easily fail because there are people who apparently import second-grade meat from all over the world and Ivorian meat can't compete. So the livestock industry does badly. What can be done to protect your emergent animal industry?

-Briefly, the country has developed the animal sector in three stages. During the first phase, from independence to about 1980, we deliberately reduced our production potential under agreements we had with other countries in the subregion, especially those in the Sahel with no resources other than livestock. Cd'Ivoire voluntarily decided not to push up its production here, but to import from the other countries instead as proof of South-South cooperation. But when the climate changed in these countries and they had disaster on their hands and their herds were destroyed, we had to launch a programme to develop our own national production. Our herds increased a lot, by more than 4% p.a., between 1980 and 1986. But at this very moment, as we are moving into phase three, we are still a long way from self sufficiency, as we can cover barely 35-40% of the people's meat consumption. So we still import meat from the Sahel nations, but as you will remember, we have had unfair competition to cope with from meat from other countries-including, alas, the EEC. This has spoiled our production drive. One of the first things I did when I took over as head of this department was to slap compensatory levies on imported meat and use the revenue to develop national production. It seemed a bit Utopian to begin with, but it has had good results-we made almost CFAF I million in the first year, which isn't bad, and we are going to be able to do a lot for animal production with that. One of the big problems today is that we do not seem able to market large quantities even though we are not self-sufficient. This is because the marketing circuits are badly organised. Some of the people running them prefer imports despite the fact that we produce meat of our own. The money we make on the levies is being used to study the marketing system with a view to getting a better deal for the meat we and our sister countries produce.

· You are a long way behind in your implementation of Community cooperation, aren't you, Minister? What is the position in agriculture?

-I think it is fair to say that we get a great deal of help from the Community and that the aid comes through various channels. A few months ago, Mr Frisch came out here and we signed our indicative programme with the Community for the next five years. It comes to ECU 105 million and we have agreed that 50% of it should go into developing the rural sector. We need an enormous amount for rural development and there is no question of the funds not being put to full use. Quite the contrary-we are asking for funds.

Where things are lagging a little is in the schemes financed from EIB lines of credit. These resources are not always used, we have discovered, because there is a shortage of viable projects, but we are going to put this right by submitting proper schemes, particularly timber and agro-industrial ones.

· One last question-Stabex. What do you think about it? Does it get used properly ?

-Thank you for asking. As you know, Stabex, alas, does not cover all the losses we incur, because it only helps with those made on export earnings. The amounts we obtain from it are very helpful and we have always made good use of them in the agricultural sector. But this year, unfortunately, we are faced with problems which our countries fail to understand- and I think I can speak for more than Cd'Ivoire here. I go to Brussels for ACP-EEC meetings every year and I hear my colleagues saying how surprised they are at the problems of getting the Stabex funds moving this year. These delayed payments cause great losses in the cocoa and coffee industries. We lost almost CFAF 600 million on consignments we should have made in October-December 1991 and if we don't get our consignments going in February and March 1992, it will be another CFAF 2 billion. There are clauses which surprise us, because if you read Lomit doesn't lay down all the conditions we are forced to abide by today. This year, let me tell you, the conditions are far tighter than those of other funders, the World Bank and so on. It came as a great surprise and I hope that explanations will be given at the next ACP-EEC meetings.

Interview by L.P.

Interview with Professor Alain Ekra, Minister of Health

'The real problem in the health sector in this country is organising the service and motivating the staff'

Alain Ekra is a doctor and Professor of Cardiology. Before becoming a Minister, he was Head of the Haemodynamics and Echocardiography Department and Deputy Director of the Institute of Cardiology in Abidjan. So he knew all about medicine before he took over the political management of the Ivorians' health. In this interview, he answered questions from The Courier, starting with the poor financial situation of medicine in Cd'lvoire.

- When you hear about medicine being the poor relation of government policy, it is all relative, I think. In comparison with what goes on in the countries around us, I have to say, we ' have made real progress here in Cd'Ivoire. It is all a question of organisation. Cd'Ivoire has indeed built a lot of health infrastructure, but to be honest, things have been handled badly, alas, and now we seem to be lagging behind with our health system. It remains only a relative lag, however, given the percentage of the national budget spent on health-which goes down every year because of the economic crisis, although it is currently still CFAF 40 billion out of a general budget of CFAF 400 billion or so. That is worth remembering.

· What are the best things about the Ivorian health service and where does it fall short ?

- I said just now that the most successful things, nevertheless, are the health and hospital infrastructure in general. You won't find facilities like them anywhere else in Africa.

· But what about the medicine itself?

-I shall come to that. I am talking about the health infrastructure because I want to emphasise the fact that, even if you go into the most out-of-the-way village in this country today, you will find a health post, whereas just after independence, there was nothing outside Abidjan and one or two towns in the interior, Bonake for instance.

'The real problem is that there are not enough means'

But what are we doing in the health service? Training staff, first of all. Just after independence, there were barely 20 African doctors in this country, because colonial doctors did most of the work. But now we have 100 Ivorian doctors practising all over Cd'Ivoire and the same goes for ancillary staff, for nurses and midwives too. We have about 2345 nurses and 1500 midwives. All these staff are available to the various health centres and they do their job well-fortunately for the Ministry of Health. The Ivorian health service enables the staff to be efficient and keep up with progress in modern medicine. The real problem today is that there are not nearly enough means available to the Ministry of Health to make the infrastructure work better. Two years ago, it was disastrous. The hospitals had no medicines and no medicines means no treatment. It is unthinkable to be treated in a hospital with no medicines. But we are putting all that behind us now, I think, and the staff are now less casual and more motivated.

Weakness of the public sector

· Nevertheless, 1 heard from people directly involved with health problems that medicine costs a great deal in this country, which keeps down the numbers who can afford treatment, even for small things.

-That is partly true. I think it comes from the fact that Ivorians got used to free medical treatment as soon as the country became independent. That is the plain fact of the matter and now it is very difficult to make a distinction between those who can pay and those who really can't. Habits are such that no-one wants to pay for health. So it is not quite right to say that treatment is very expensive in this country, because there are plenty of private clinics here and people go to them. Maybe they are insured? Well, no. It isn't always those who have health insurance who go into private clinics. The real problem in the health sector in this country is organising the service and motivating the staff-and I know what I am talking about, because, as I said at the beginning of our talk, I have practised medicine myself, here in the Institute of Cardiology. With the health service as it is today, I should say that plenty of patients might prefer to go to a private clinic and pay and see a doctor-which they are by no means sure of doing in the public service. That is the real problem.

'People have to know what happens to the money they give for their health'

· Bearing in mind all you have just said, what is the current health policy:?

-It is a simple policy. As I said, we found a catastrophic situation, staff who had lost interest, a severe shortage of medicines in the hospitals and other health places and-most important- we found that infrastructure and equipment had been neglected. We wondered about a different approach. But what? Well, we think we have to try to set up a health policy which costs the State less. And that, we think, means starting with the primary structures and taking a greater interest in basic health care. So our policy is geared far more to primary health facilities - but not forgetting curative medicine of a high standard. If we are to make a start on a lasting solution to this country's health problems, then health service users have to be able to contribute to the costs. We are trying to get this idea of responsibility over to the users. They are coming round gradually-but, of course, they have to know what happens to the money they give for their health.

· What might make the people want to make an active contribution to health financing ?

-In Cd'Ivoire, you know, they have always contributed to it through the rural development fund, the system whereby the people pay a third of the costs of building health posts in their villages. Now we have a crisis on our hands, we make sure that these building schemes are done properly and then the Government-and this is the authorities' duty-have to fit them out and provide the staff. We also maintain that the population absolutely must be involved in managing the health posts, by setting up village committees, and soon, with the decentralisation we are organising, they will be able to take an active part in running much bigger structures, such as regional hospital centres and departmental and general hospitals, too. It is vital for the people to participate.

A rapid spread of HIV

· The experts, even national sources, say that the AIDS situation is fairly critical, as the virus has spread fairly rapidly in this country. Why has III V spread rapidly here ? Do Ivorian men and women have any specific behaviour patterns which might explain it?

-First of all, if it has been found that AIDS has spread rapidly in this country, then this country must be congratulated for recognising the fact and saying so. Many countries fail to say what the exact situation is and issue entirely misleading figures. We have set up an AIDS epidemiological system which is very good at detecting the disease and we are now able to say exactly how many cases we have.

Why has the incidence of AIDS rocketed in this country ? For very much the same reasons as in the other countries of Africa or anywhere else. There are traditional problems and there is individual behaviour. Africans have always said that AIDS isn't an illness and that it is being used to prevent them from living their lives... Condoms aren't really accepted yet either. All that has something to do with it. Then, if you look closely, there is the drug problem which has started to affect Africa, especially a crossroads like Cd'lvoire. All these things explain why HIV has spread so fast here.

· So you do not just have the classic AIDS victims who have caught it through sexual contact or blood transfusions, but just as many who have been contaminated through drug abuse as there are in Europe ?

-Absolutely. We are aware of the phenomenon. It cannot be explained otherwise. There is also the fact that Cd'lvoire is known to welcome visitors. Everyone can come and go and that has something to do with it too and it is difficult to control. But it would be wrong to hide the fact that most of the many cases recorded here are Ivorians and not foreigners.

· A very high percentage of your AIDS victims are very young, which could well undermine the country's economic future and not just its economic future...

-Indeed, the age bracket with the highest incidence in both sexes is the 5-39s. This is a disaster and there is no doubt that it could seriously undermine the country's future. We are aware of the fact and we are trying to do something about it with prevention and information. There are regular awareness sessions for young people in Abidjan to try to wake them up to the fact that AIDS is a grave danger.

· Does this campaign include anything in the schools, for example, and, if so, what? am thing particularly about sex education in schools here...

-I have to say no. Sex education is not on the syllabus very early on, but we do bring the parents into it. It is up to the parents in the early stages, I think, and we carry on the good work with the older pupils and in the advanced classes in high schools and colleges. That is the age at which they are made aware of it all. There have been a lot of seminars for practically all the high schools and colleges in the economic capital (Abidjan, Yamoussoukro, where President Houphouet-Boigny was born, being the administrative capital) and in the interior. The job is done, although it has to be admitted that, for various reasons, it is done modestly.

· Minister, what criticism do you have of the various forms of cooperation, starting with Community cooperation, in the health sector ?

-To be honest, there is very little to criticise in our relations with the Community. We ask for aid and our partners and friends give us what they can.

As to cooperation in general, all I can say is that the people who assist us do not force their opinions on us. They would be open to criticism if they did. We get on, but imposing a policy on us I would find rather humiliating-and I have to say that it is a problem I have never come up against in my job here as head of the Ministry. So, as far as cooperation is concerned, I am satisfied-particularly with cooperation with the EEC.

'No threat...'

· The Community does a lot for public health in this country, doesn't it ? Can you summarise the main areas concerned ?

-Overall, I think, we are satisfied with the fields of Community assistance and particularly with the medicines supply operation where Community aid is very effective. As I said just now, when I took over here, there were no medicines in the hospitals, but things are far better now. I have just done a grand tour of western Cd'Ivoire and realised that the people are happy because they have basic medicines. That is thanks to EEC cooperation. The Community is also helping us with the AIDS campaign by improving the blood transfusion facilities-go to the transfusion centre and you can see just what has been done-and with staff training, as you said. It has been efficient in this cooperation and I have to say that we are hoping it will do a lot more, particularly in the health sector. The EEC could also help with our policy of rehabilitating infrastructure. It's more a question of rehabilitating than building these days, for there is no point in putting up vast complexes which are difficult to manage. To sum up, what I should say is that, when it comes to cooperation in the health sector, the biggest and the best comes from the EEC.

· Unlike other African leaders, you in the health sector here do not seem worried about the Community cutting its aid to Africa in general and its health services in particular so it can concentrate on the countries of Eastern Europe...

-I don't think it will. In the beginning, I did think about it, I have to say, but I do not think that the European Community, with the great union soon to be formed, can drop Africa. It would be a shame. My belief is, as the President of the Republic said, that the raw materials are in Africa and the countries of Europe will always need them. They will be forced to help us develop. In my opinion, the Twelve's commitments to Eastern Europe are no threat to the future of relations between Africa and the Community. L.P.

The National Blood Transfusion Centre

Blood donations and AIDS control

As Professor Alain Ekra, Minister of Health and Social Security points out, HIV has spread across Abidjan (2.5 million people) and the rest of the country like wildfire. One of the many reasons for this' says Dr Alain Bondurand, Head of the National Blood Transfusion Centre, is the fact that 'the danger of AIDS has not got home to the people . It is not that they are unaware, he says, but that they just do not take it seriously.

What makes the inhabitants of the capital behave like this towards what is, after all' an unprecedented threat to human life and the continuation of the human race? AIDS is the commonest of the sexually transmitted diseases (14%) and one explanation for what Dr Bondurand has found could well be that, with all the serious economic problems they face, the underprivileged have simply laid down their arms and surrendered to despair.

The health authorities are tackling the disturbing spread of HIV in Cd'Ivoire with more and more nationwide campaigns to inform, prevent and, of course, detect the disease. HIV is being traced through the blood donations at three transfusion centres, two of which are in Korhogo and Bouake.

Blood donors are not paid, but the National Transfusion Centre still has many volunteers and their numbers have increased, particularly since reception facilities for visitors improved and the Centre began paying for their transport (CFAF 500) and offering snacks after taking blood.

We have the authorities and the National Blood Transfusion Centre to thank for the fact that we can pinpoint the AIDS situation in Cd'Ivoire exactly.

Aid from the European Community helps equip the Centre with all the technical resources it needs to perform its tasks. In the course of the year, the Centre will be made a National Public Establishment with its own budget and considerable leeway in its operation-a move intended to make for greater efficiency and better yield, particularly when it comes to the country's new general prices policy.

The change in status should mean that income can be generated through sales- of bags of blood and not blood itself, as organ-trading is to be avoided. L.P.

Seydou DIARRA, Head of SACO: From diplomat to industrialist

Development is everybody's problem and economic policies, however perfect, mean nothing until they are put into practice and there are results to judge them by.

In the Ivorian battle to reshape the economy, there are few lines to draw now between the administrators and the operatives-an example embodied, possibly unintentionally, by Seydou Diarra, Cd'Ivoire's former Ambassador to Brussels, London and Rio de Janeiro, whom many in the Commission and, of course, the ACP Group have had the. opportunity to know and appreciate.

Seydou Diarra went home in 1985, keen to leave the diplomatic corps and move into industry, to 'get some actual hands-on experience of development'. It was his desire to get to grips with fundamentals and improve effectiveness which prompted this agricultural engineer and chemist to spend five months on the shop floor, on the chocolate production lines in Melun (Paris), before he took over SACO, the African Cocoa Company, in the Chocolatiers Barry group.

When The Courier met Seydou Diarra, now Managing Director of Cd'Ivoire's major cocoa-processing industry, at SACO headquarters, he grabbed an overall and ushered us off round the plant to explain the various stages in the chocolate-making process.

The first task he set himself was to reorganise and modernise. This has been done.

The output of all three units has gone up and SACO is now handling 85 000 t of liquor equivalent, 45 000 t of it in the Abidjan Zone 4 plant.

SACO turns out semi-finished products (butter and oilcake), which are exported to the USA, one or two States in the CIS and, of course, Europe (where the Netherlands, France, Italy and Switzerland are the main customers). It also makes finished products, such as choco late (800 t p.a.), much of which goes to other countries in Africa and to Europe and the USA, as well as groundnut paste, which is consumed locally.

The 670-strong staff includes 37 senior employees (technicians and engineers), five of whom are European. The company has a turnover of nearly CFAF 40 billion.

The managing director's conviction that he has taken the right turning is very strong. His chosen career is a difficult one, no doubt, but it enables him to fulfil himself in a different way from before.

As Seydou Diarra puts it, 'the challenge of business is highly stimulating'..,


Opposition - Running for government means building a credible force

Holding the reins of power is no easy task, which is perhaps why, in many countries, especially in Africa, the holders of power have opted for an unassailable single party. But now the hour of democracy has struck, it is no easy task being in opposition either. One of the many reasons for this lies in the nature of the opposition parties themselves, especially in Africa, where they have all the handicaps of being divided, fragmented and lacking any credible political, economic or social plans or programmes with which to back up their criticism of governments with decades of experience behind them.

This is the situation in Cd'Ivoire, although the country has no monopoly, on it. Beyond all the judicial and other impediments which, with its political, advantage and its control of the State machinery, the Government can put in the way of the opposition, the opposition parties are failing properly to gauge the full weight of opinion they have to shift, nor do they suspect how seriously they are handicapped by having no experience of power.

There may well be a genuine, deep seated desire for change in Cd'lvoire, but the plain fact of the matter is that the people want to know just who their would-be rulers are. Whatever the courage and charisma of the leader of the de facto opposition, Laurent Gbagbo, the FPI (Ivorian Popular Front) Secretary General who once ran against Houphouet-Boigny in the presidential elections, he has never had the plans or arguments to win people over. Indeed, one or two of his tactical errors gave the Government a golden opportunity to reduce his chances drastically.

But there is variety in the Ivorian opposition. Take Professor Bernard Zadi, Secretary-General of the USD (Union of Social Democrats), a democracy activist for more than 20 years, first in France, with the FEANF (French Federation of Black and African Students), and then in Cd'Ivoire, where he has been arrested on a number of occasions. How does he see politics in his country now that the multi-party system has been recognised?

'This is the first ray of sunshine in politics here', he says. His big concern is the difficulty of organising the forces of democratic change in Cd'Ivoire. 'Once the parties were recognised, the FPI came straight in with its opposition coordination initiative,' the Professor told me. But, as he made clear, there was no organic basis to it and it only served to underline the inconsistencies between the opposition parties, particularly after presidential elections were announced in October 1990. 'People were confident in the opposition while it was united, by and large, but the crack which the FPI created sowed doubt'-and enabled President Houphouet-Boigny to be elected again. 'The FPI is a populist party based on the charismatic image of Laurent Gbagbo and it takes a hot-headed, slapdash approach to serious, complex economic issues and the running of the State. The crowds which attend meetings and demonstrations are not always militants. Most of them are people with nothing to do, whose enthusiasm is no sorner kindled than it dies down again'. Professor Zadi added. The personal reputation of the leader of the FPI was not high enough to win him the presidential elections. That was something he had failed to understand.

The opposition must be credible if it wants to govern

What the USD wants now is to build up the opposition forces so they are credible and can win the elections and govern the country democratically, Bernard Zadi says. They must learn from what has gone before. They must try to get joint opposition party schemes off the ground again with such things as flexible coordination and proposals embracing every aspect of the economic political and social life of the nation. They must think about how democracy should function, for, he maintains, the conditions for it are not right at the moment. 'There is no separation of State bodies and ruling party at the moment' Professor Zadi says. 'The Government does not yet see the opposition as essential to democracy. Equally, the President of the Republic is not yet seen as the President of all the Ivorians but as the President of his supporters and his party. The opposition does not get invited to the ceremonies of the Republic as it would in any proper democracy'. And then of course there is the problem of financing the political parties in such a way as to avoid any confusion between public monies and spending by the ruling party.

Anything likely to diminish the opposition's credibility must be avoided, Zadi maintains, and the USD indeed spoke out against the scheme which some opposition parties were hoping to use to stop the national assembly from debating the press law, although it was in fact itself against it. The Leader of the USD also said he disagreed with the way the Government had put down the February demonstration in Abidjan and had treated the MPs and political leaders who were, rightly or wrongly, caught up in it. L.P.

The Basilica at Yamoussoukro: The Work of an unfathomable conscience

Everyone has heard, or seen pictures, of the Basilica of Our Lady of Peace in Yamoussoukro. This is the building whose consecration by Pope John Paul II on 10 September 1990 prompted a major controversy between supporters and opponents of the Church. Without wishing to join in the debate, which in any case is now largely over, The Courier decided nevertheless to have a look at the edifice which had provoked such strong feelings on either side.

Travelling along one of Africa's most attractive roads, between Abidjan and Yamoussoukro, one reaches the village where President Houphouet-Boigny was born. At the entrance to the village, which is actually a major regional centre, the road suddenly widens and turns into a huge avenue. At the far end stands what is now the most celebrated building in Cd'lvoire-the Basilica of Our Lady of Peace. Impressive even at a distance, the Basilica at Yamoussoukro compels admiration and wonder. Both outside and inside, it is beautiful. One feels one must slacken one's pace so that the eyes have time to take in the perfection of a monument whose very reason for existing is to be found only in the unfathomable conscience of its creator. But to that, of course, we have no access ... At any rate, be it the pillars, the altar, the baptismal font, the dome, the seats or the stained glass windows where the President and Servant of God, Felix Houphouet-Boigny, is to be seen amid all the company of heaven, the immediate effect of everything in the church is one which surpasses rational thought.

As soon as one comes out, reality quickly takes hold again, and it is difficult -unless one is moved by the spirit of the place or by God-not to wonder, at the very least, how strong the religious convictions of a man who somehow found the resources to put up such a colossal monument can really be. It is undeniably an architectural triumph.

Perhaps the answer is contained in a sentence to be found in the introductory booklet to Our Lady of Peace. 'God is mad with love for each one of us,' it reads. Could it be that man, too, is mad with love of the godhead or, indeed, of a history which has for so long forged that other, black consciousness? It is not for us to say.

Whether you are for or against Our Lady of Peace, though, is now beside the point. The Basilica has become a place where large numbers of visitors, believers and non-believers alike, come together. So, in fact, has the town of Yamoussoukro, with its fine avenues, prettier in parts than those of Abidjan, its schools, its five-star hotel, its African Library, its street souvenir sellers and its high prices, which are in inverse proportion to the incomes of Cd'Ivoire's people... And not forgetting the crocodile pool !


EC-Côte d'Ivoire cooperation

by Francisco da CAMARA S.C. GOMES

Cd'lvoire and the Community have been cooperating for many years, ever since the pioneering era of independence and the establishment of the European Development Fund.

Great mutual understanding over three decades of combined effort has made these privileged relations what they are today.

Cd'Ivoire has been closely involved in the gradual extension of Community cooperation and its range of instruments under the Yaounde and then the Lomonventions, both as an active negotiator in the AASM and the ACP Group and as a partner in the application of successive policies, and it is clearly aware of the full potential of these varied and complementary instruments, although it is also realistic about the fact that this exemplary cooperation has its limits. The constructive, permanent dialogue which has been firmly established reflects peaceful acceptance of the level of interdependence reached, great mutual frankness... and the occasional impatience.

The fact that agricultural exports are decisive to the Ivorian economy and exports are the driving force of the development model adopted in the first 10 to 20 years of independence (and even before) could have made the importance of financial and technical cooperation merely relative, because everything hinged on the terms of access of the output to the Community market, the workings of international commodity agreements and the use of financial machinery to stabilise export earnings. In fact-notwithstanding the substantial benefit which Cd'lvoire has had from the trade arrangements, product agreements and Stabex-financial and technical cooperation has never been neglected.

Community development aid has had a solid impact, largely because the successive focal sectors have been chosen in the light of the needs of the moment. Initially, the (first) European Development Fund concentrated on social infrastructure (50%) and economic infrastructure (38%), with the building of schools, health facilities, water supplies, roads, railways and so on.

With Yaounde II and the 2nd EDF, priority went on rural modernisation (72%), diversifying cash crops being the main idea behind the oil palm plan. This move towards rural production gained ground with Yaounde II (3rd EDF), when 66% went into rice development and other agricultural schemes. Lom (4th EDF) saw economic infrastructure projects disappear completely from EC-Cd'lvoire cooperation, to the benefit of rural development (44 %) and social development (40.5%), with diversification catered for by rubber plantations and food security by rice and livestock.

The priority on rural development was clearer still under LomI (5th EDF), when 57% went on agricultural projects, with 22% for social infrastructure and 9% for microprojects. Diversification was still there with oil palms and fruit growing, while food security was catered for by further extensions to the rice crops, plus marketing support for the cooperative movement. LomII (6th EDF) would have developed along the same lines had it not been for the serious economic and financial crisis which struck the country in the 1980s, forcing it to run an adjustment plan and ask for Community aid to be reoriented to provide direct support for the stabilisation policy.

Cd'Ivoire handled this unprecedented crisis, which had a great deal to with the drop in its export prices, with corrective measures on a large scale. The 6th EDF national indicative programme (ECU 82 million) had rural development in the broadest meaning of the term as its focal sector, with special priority on self sufficiency in food, settling young people in rural areas and developing the savannah region. It was 46% committed when the National Authorising Officer asked the Commission to reorient the aid to provide a sectoral import programme as backing for the stabilisation and economic recovery policy.

So 50% of the 6th EDF indicative programme-ECU 41 million-was switched and used to finance oil imports, which yielded counterpart funds to cover budget spending targeted on farming and public health. In agriculture, Cd'Ivoire's contributions could be paid to projects cofinanced with the Member States and the World Bank.

In public health, all health posts, centres etc were resupplied with basic medicines under a health policy reform which put priority on primary health care, rationalised hospital management and a reduction in the cost of medicines.

The other half of the 6th EDF programme was spent on the original priorities, which were, mainly, village oil palm plantations (ECU 20.85 million), the cattle and sheep development support programme (ECU 11 million) and the three micro-project programmes (ECU 3.76 million). Commitments from the 6th EDF programme totalled more than ECU 80 million in March 1992.

Total community resources to Cd’Ivoire, Ecu million - situation as of 6 March 1992

The national indicative programme for the period of the first financial protocol of LomV (7th EDF) was signed on 11 July 1991. The Government produced a summary of the stabilisation programme designed in 1989 (this was positive overall, with a large cut in the primary budget deficit and reforms running in various sectors) and set up a medium-term economic programme in that year too. The 7th EDF indicative programme reflects a desire to overcome the structural and cyclical problems of the economy. The focal sectors are:

a) rural development (50% of programme resources), with schemes to step up productivity, augment and diversify production and improve the marketing of food and cash crops, the protection of the environment, improvements to sectoral policy programming and support for the cooperative movement and the professional organisations;
b) the urban sector (30%), with decentralised management schemes to improve urban centres of economic and social development. These will be mainly on the coast, as a complement to other funders' operations, as part of the development programme devised in conjunction with the municipal councils. They will provide support for the drive to improve the management potential and boost the resources of the local authorities, improve the urban standard of living and environment and develop economic activity;
c) human resources (10%), with particular reference to health. Community aid will offer support for the human resource development programme, the programme to improve national planning and programming potential (Ministry of Health and Welfare), the basic medicines and cost recovery programme and the setting up of permanent training and information facilities for nurses;
d) a 10% reserve not specifically allocated can be used to finance schemes to back up the regional programmes and provide support for priority schemes following implementation of the indicative programme.

ECU 105.5 million is available for this 7th EDF programme. ECU 90 million of it is in the form of grants and a first allocation of ECU 15.5 million as specific resources from the structural adjustment support facility-to which will no doubt be added a significant amount in non programme aid, in particular for Stabex. Lomon-programme resources are large-far in excess of the amounts of the indicative programmes (see table)-and the biggest single instrument is, of course, Stabex, accounting for transfers of more than ECU 0.5 billion to date.

With LomV, Stabex now helps in two ways - by supporting various sectors which have suffered losses in export earnings and, macroeconomically, by neatly fitting into the series of resources which can be mobilised to support structural adjustment. In Cd'lvoire's case, there is a mutual framework for obligations (signed on 21 December 1991) fixing the uses involved in this new approach. The Stabex 1990 transfer was intended to help run the country's structural adjustment policy (supported by Bretton Woods and the main funders), back up its reorganisation of the coffee and cocoa sector and support diversification, in particular into cotton and rubber.

This short account of trends in EC-Cd'lvoire cooperation, from its origins down to the present day, clearly reveals a constant concern with helping the drive to develop the country and revive its economy in the right way at the right time. The current priorities

-export competitivity, agricultural diversification, environmental, protection, decentralisation and improvement of local authorities, structural adjustment (particularly the social aspects), health service reform and reorganisation of the cocoa-coffee sector- have coherent backing from all the instruments of Community aid.

Nevertheless, these instruments can only help the country correct the endogenous causes of its serious economic and financial crisis. They cannot replace the national effort.

Cd'lvoire is also working on an international plan to get better terms for debt and commodity prices, the two big external causes of crisis. It has a great deal of faith in what the Community can do to help here, particularly when it comes to getting the International Cocoa and Coffee Agreements going again.

F. da C.G.

Eldorado of the South Pacific

Papua New Guinea-the Eldorado of the South Pacific is about to be discovered by the rest of the world'. This is the message of those responsible for organising the country's pavilion at Expo '92 in Seville, and is to be found in a full-page advertisement in the November 1991 edition of Pacific Monthly. The publicity goes on to describe the country's participation in the Universal Exposition as a 'bold new initiative' which 'will displace the image of Papua New Guinea as a land of traditional outlooks, projecting a fresh new perception of potential and opportunity in a country with an enormous scope and depth of natural resources. No nation, it concludes, 'is better suited to the Expo theme, The Age of Discovery, than Papua New Guinea'.

Of course, publicity material of this kind is expected to paint the 'product' in as rosy a light as possible. A country's Expo pavilion is its showcase to the world where strengths and not weaknesses are emphasised. In this Country Report, we look at the claims made above for Papua New Guinea and examine the main political and economic issues affecting the country today.

Papua New Guinea, which gained its independence from Australia in September 1975, lies to the north of the former metropolitan power, between the Solomon Islands and Indonesia. It is a large, mountainous country (465 000 square km) with a relatively small population (approximately 3.7 million inhabitants) and an astonishing range of local cultures. While English is the language of administration and business, Pidgin and Hiri Motu are also widely spoken in the north and south of the country respectively. However, there are also more than 700 other languages, which give PNG the distinction of being the most linguistically diverse country in the world.

The bulk of PNG's land area (85%) is on the main island, the western half of which belongs to Indonesia. Six hundred other islands make up the remaining 15%, the principal ones being New Britain, New Ireland, Bougainville and Manus. Port Moresby, the capital, is also the largest population centre, while the other principal towns are Lae, Madang, Wewak, Goroka and Rabaul.

The country is a constitutional monarchy within the Commonwealth, with Queen Elizabeth II as Head of State. Political power is vested in the unicameral Parliament, which has 109 members elected by the simple majority system in individual constituencies. The Prime Minister and Cabinet are chosen from among their number.

The people of Papua New Guinea are principally of Melanesian origin. Until recently, contact with the outside world, and indeed among some tribes within the country, was very limited. As one might expect in these circumstances, traditional lifestyles are still very important, although the effects of so-called 'modernisation' are increasingly widely felt, even in the remoter Highland areas.

The country's formal economy relies heavily on a relatively small number of mining ventures. The principal mineral resources are gold and copper. On the energy side, PNG has considerable hydro electric potential, much of which is undeveloped, while oil will be exploited commercially for the first time during 1992. The forestry and fisheries sectors are also important and the main agricultural products-coffee, cocoa and palm oil-are significant contributors to the economy. In contrast to many ACP states, Papua New Guinea is therefore rich in resources. Its main concern is how they should be exploited in the best interests of its own people.


Among the first impressions one gains of Papua New Guinea, perhaps the most striking are the contrasts. Port Moresby is a modern city with high-rise blocks yet a journey of only a few kiLomes takes one to villages where the traditional lifestyle prevails. The capital's road network is extensive and relatively well maintained but the highways which emanate from it do not connect to other parts of the country and it is not long before the bitumen surface is left behind. People from all backgrounds get around the country by ship or aeroplane and one of the most surprising features is the scope of the scheduled air transport network. With numerous airports, and hundreds of airstrips, PNG has one of the most extensive domestic airline services in the world. Indeed, demand is beginning to outstrip the capacity of the passenger ' terminal at Port Moresby (where new; facilities are soon to be built) and the scene there on an average day would certainly be familiar to the European air traveller.

Of course, in one general sense, Papua New Guinea is not unique in the ACP world. The pattern of local culture and European influence blending together (and from time to time conflicting) is one which has been repeated wherever colonisation of already inhabited territories occurred. What makes PNG different is that in many parts western influences were late in coming and the geography of the area meant that indigenous society was highly fragmented. Indeed, it is inappropriate to talk of a single 'society' -the population of the country belongs to hundreds of different societies, many of which had, until this century, little or no contact with the next valley, far less the world beyond.

John Gihenu, who is PNG's Minister for Trade and Industry and comes from the Highlands, stressed in an interview with The Courier the importance of 'nation-building'. The more one discovers the diversity of this country, the more one appreciates the scale of the challenge. On the positive side, the fact that so many groups exist may help to prevent dominance by any single one, and the shifting alliances which characterise national politics would certainly tend to bear this out.


The governmental system of PNG provides a fascinating case study for students of political science. Modelled on Westminster (although there is only one legislative chamber), the focal point of political power is the 1 09-member Parliament. It would be a mistake, however, to assume that politics have followed the same route as in the original metropolitan power (the UK). The most significant difference is the weakness of the party system. There are a number of parties but the allegiance of voters tends to be more personal (or familial) than ideological. Until recently, elected Members have 'crossed the floor' with monotonous regularity, undermining government majorities and generally contributing to an atmosphere of instability. Parliamentary motions of no-confidence hang, like a Sword of Damocles, over the head of every Prime Minister. From time to time, the sword descends, dispatching the hapless incumbent to the opposition benches. There, in all likelihood, planning for the counterstroke will immediately begin.

On the positive side, this situation ensures that Parliament is no rubber stamp, but truly a sovereign institution, as it is intended to be in political theory. The disadvantage is in the effect on political stability and, perhaps more seriously, in the amount of effort required to put together and sustain a working majority. A Prime Minister who has to spend a large amount of time keeping his supporters on board will have less time for the economic and social policy issues which must also be tackled. It should be noted that the current Prime Minister, Rabbie Namaliu, whose astuteness is widely recognised in PNG, has successfully stayed in office for three years (although an election is due in May/June 1992).


One further aspect of the PNG political set-up is worth noting. In the absence of strong parties, and given that the job of Member of Parliament is highly sought after, each constituency contest attracts large numbers of candidates. The author Sean Dorney records, for example, that in the 1987 election 45 hopefuls presented themselves to the electorate at Kerowagi in Simbu province. The winning candidate was an independent who polled 7.9% of the valid votes! Countrywide, only a very small proportion of the total ballots cast actually contribute to someone's election, and this leaves a large pool of potentially disgruntled electors whose votes have no real value. Perhaps the task of nation building would be made easier if Papua New Guinea moved to a preferential system of voting.

In any election, about half of the incumbents are defeated and the importance of retaining the support of one's own electorate certainly leads to some extreme manifestations of 'pork-barrel politics'. (The expression is peculiarly appropriate to PNG, since the pig features highly as a peace-offering or gift in ceremonial exchanges, particularly in the Highlands).

For many years, reforms to the political system have been promised, aimed at strengthening the parties, reducing the number of candidates and generally stabilising the system of government. In the 1992 election, several such reforms are due to be implemented, including one which requires each candidate to lodge a deposit of K1000 (ECU 1200). Only the winning candidate will have the deposit repaid. It is hoped that this will discourage 'frivolous' candidates with little chance of election.

While most of the political power in Papua New Guinea rests with Parliament in Port Moresby, mention should also be made of the system of regional government which has been set up. Although the country has under four million inhabitants, there are no fewer than 19 provincial governments as well as a devolved authority to look after the capital territory. This has led to suggestions that PNG is overgoverned. It is certainly true to say that they have a large number of legislators but, on the other hand, with so many different cultures and groups to accomodate, it is difficult to see how a centralised unitary structure could work effectively without creating tensions in the provinces. This is particularly the case when one considers that Port Moresby has no overland links with the majority of the population living in the highland, northern and island provinces. The strife in Bougainville, where a secessionist movement (the BRA) has been fighting a guerilla war against Government forces, is evidence enough of the centrifugal forces which could threaten the unity of the country. Decentralisation is an acknowledged strategy for defusing problems of this kind.

Within the Department of Provincial Affairs in Port Moresby, the official view is that the system of provincial government works quite well. The Department is involved in training for both provincial officials and Assembly members and it provides advice and assistance in a variety of other areas. On the other hand, the powers of various provinces have had to be suspended from time to time because of mismanagement, and doubts remain in some quarters about the effectiveness of this layer of government.

Constitutional crisis averted

In any contemporary discussion of PNG's political system, mention must be made of recent events which tested the robustness of the country's constitution. The situation arose out of a scandal involving the Deputy Prime Minister, Ted Diro. Mr Diro was an important political figure as the leader of the People's Action Party (whose main power base was among the Papuans in the south of the country). In such a diverse nation, preserving a regional balance in the administration is considered to be important. In 1987, the Barnett Commission of Inquiry into Aspects of the Timber Industry issued a damning report on alleged corruption and mismanagement in the forestry sector. Mr Diro was one of the principal figures identified in this process and, although various at tempts were apparently made to prevent charges being brought, the legal system ultimately prevailed. Thus it was that in September 1991, Mr Diro was found guilty by the country's leadership tribunal on 81 charges of corruption, bribery and misuse of office.

The constitutional problem arose when Governor-General Sir Serei Eri, a fellow Papuan, refused to sign the dismissal instruments. As the monarch's representative in Commonwealth countries which maintain their allegiance to the Crown, the Governor-General should play only a formal role in the political process. By convention, he will 'follow the advice' of his Ministers and avoid becoming embroiled in political controversy. In the case of PNG, recommendations of a leadership tribunal are actually binding on the Governor-General and his refusal prompted the Cabinet to take drastic action. They agreed to recommend to Queen Elizabeth that the Governor General be dismissed and it was only at this point that Sir Serei and Mr Diro tendered their resignations. For some time, there was concern that the imbroglio might provoke a backlash among the Papuan population, but in the event this did not happen. For Papua New Guinea, the outcome was particularly significant because it demonstrated the robustness of their constitutional system. Unlike many countries in Africa, the country's political arrangements have not been substantially altered since independence, and this element of stability, notwithstanding the rough and tumble of day-to-day politics, is seen by outsiders as important for investment purposes. Accordingly, there is quiet satisfaction in official circles in Port Moresby that the Constitution has survived this test.


Although Papua New Guinea has never been tempted to experiment with socialist or one-party systems of government, it would be exaggerating somewhat to describe it as a paradise for the investor, whether domestic or overseas. The two most significant impediments, in this regard, are the lack of infrastructure and the security situation. The first is a problem which PNG shares with many developing countries, although in some regards it is more acute. There must be few mainland capitals in the world which are so isolated from the rest of country in terms of overland links. Electricity supplies and other services are limited to a few urban centres and a lot more progress is also needed on the educational front. It would be unfair to be too critical of this situation, however, since in all these areas PNG has moved forward very substantially since independence.

The security situation is rather different. Although high and increasing crime rates are the scourge of urban areas in industrial and developing countries alike, the problem appears to be particularly acute in Papua New Guinea. Many inhabitants of Port Moresby have taken to living behind high security fences as robbery and violent crime have grown. Even in rural areas, violence is relatively commonplace, although here it is more often due to traditional rivalries or feuds between neighbouring 'wontoks'.

The situation is exacerbated by tensions over land rights. The traditional system of land tenure, with its emphasis on community ownership and its complex pattern of rights and obligations, may have certain attractions, but it does not lend itself readily to economic development. In the past, large-scale projects by overseas companies have had a major impact on the land, with local owners not necessarily seeing much benefit - this is particularly true of mining and forestry exploitation. Tensions have built up and violent acts have been carried out. Indeed, it has been argued that the catalyst for the secessionist movement in Bougainville, whose guerilla activities led to the closure of the Panguna Mine, was resentment over the despoliation of traditional tribal lands (opencast mines inevitably change the landscape) combined with a belief that the local people most affected had not received a fair share of the financial benefits.

More recently, an arson attack on the Mount Kare gold mine in mainland Papua New Guinea, which has closed the operation altogether, has raised further worries, particularly among foreign investors. Finance Minister Paul Pora plays down the significance of this attack. Speaking to The Courier, he suggested that it was an isolated criminal act and he pledged that those who were responsible would be brought to justice. He was also keen to underline the Government's commitment to overseas investors revealed in their recent decision to join a multilateral, international insurance guarantee scheme.

Also on the plus side, it must be acknowledged that the Government has pursued extremely prudent economic policies and this is reflected in the strength of the Kina and the relatively healthy state of the foreign reserves and government finances. The traditional images conjured up by the term 'structural adjustment'-radical restructuring of the civil service, large scale rationalisation and privatisation of parastatals, huge cuts in government expenditure and so on, are inappropriate here. The measures which had to be taken in PNG involved some inevitable discomfort but the underlying position was sound.

Notwithstanding the problems of infrastructure and security, there is no doubt that many entrepreneurs do see it as a country of opportunity. There have been successful ventures, particularly in the mining sector (the Porgera Gold Mine is thought to be one of the largest and most productive in the world) and there is clearly a great deal of untapped potential.

The social dimension

What of the people of Papua New Guinea? In talking of investment opportunities and of opening up the country to foreign investors, there is a danger of failing to take account of local people's feelings. It may seem perilously close to sacrilege, in a world where the free market has triumphed, but could it be that local people would prefer some of the untapped potential to remain untapped, at least for the present?

It would not be surprising if PNG's experience in the forestry sector gave rise to this attitude. The country's forestry resources have been heavily exploited by overseas logging companies and inquiries (notably the Barnett Commission whose report was mentioned above in the context of the Diro scandal) have shown that through a variety of corrupt practices and massive transfer pricing, the financial benefits to PNG have been minimised. The Government is committed to remedying this situation with a variety of environmental measures, firmer controls on the activities of logging companies and the adoption of a tropical forestry action plan.

Despite worries over the effects of resource exploitation on the natural environment, the problems and challenges which face the majority of the population are likely to be more prosaic. Unemployment appears to be on the increase although it is impossible to come up with a meaningful figure for those out of work since, in common with many other developing countries, PNG has a very large informal sector. According to the most recent complete figures available (for 1983) only 10 to 15% of the economically active population were in formal employment (although a marked increase has been recorded in some individual sectors since then). The bulk of the remainder are engaged in agriculture either as smallholders or on a subsistence level but a significant proportion will certainly be underemployed, if not wholly without means of support.

The 'duality' of the economic system is reflected in the education system. From a very low base at the time of independence, education in Papua New Guinea has made enormous strides and this should be acknowledged. However, it still fails to reach a substantial proportion of the population and there is clearly a lot still to be achieved. Primary enrolment is currently estimated at 70% of the eligible age group (60% twelve years ago). Wastage (ie dropping out) between grades 1 and 6 amounts to 30-35%. Owing to limited resources a selection process in grade 6 is necessary and only 35% of those who complete primary education can be offered a secondary place. The haemorrhaging of young people from the education system continues at the tertiary level and only a very small number have the opportunity to go on to degree studies. The Government is well aware of the need to improve and expand educational opportunities. Trade Minister John Gihenu sees this as the most important factor hindering economic development and strongly emphasises the need for practical instruction. His views are echoed by many others in the government services.

Potential and opportunity?

So has the image of Papua New Guinea as the 'land of traditional outlooks' been replaced-as the Expo publicity would have us believe - by the 'land of potential and opportunity,? Is such an image change in fact desirable ? It is clear that there is potential and opportunity in PNG which is expressed in the vibrant private sector. Overseas investors have always been welcome and those willing to take risks can reap big rewards. But Papua New Guinea is more than merely a wealth-generator for entrepreneurial outsiders. Its people have their own concerns and interests as well as their own unique cultures. If the traditional and modern aspects clash, as they have done from time to time, then the future development of PNG will always be constrained. If, on the other hand, ways are found to reconcile existing cultural values and the modern world which laps at its shores, the people of this fascinating country should be able to look forward to a brighter future. Simon HORNER

Interview with Prime Minister Rabbie Namaliu

'Tough but necessary policies' underpin economic recovery,

Rabbie Namaliu is a man who is well-known in ACP circles. It was he who signed the LomII Convention in December 1984 on behalf of the ACP Group in his capacity as President of the ACP Council of Ministers. (He was the Foreign Minister of Papua New Guinea at the time).

'Meteoric' is perhaps the most appropriate adjective to describe Mr Namaliu's rise to his country's top political position. Still only in his mid-forties, he entered national politics in 1982, winning the seat of Kokopo in the elections of that year. He speedily became Foreign Minister under Michael Somare (now Sir Michael who, in an interesting role reversal, currently holds the Foreign Affairs portfolio in the Namaliu Cabinet).

In the shifting sands of PNG's parliamentary system Rabbie Namaliu is increasingly recognised as a survivor. He became Prime Minister in July 1988, a mere seven days after becoming leader of the Pangu Pati (Party) which was then in opposition. Initially, there were few who expected his premiership to last very long but he is still in power almost four years later-a continuous term of office which is unprecedented in the country's short post-independence history. Despite the ever-present threat of a parliamentary motion of no-confidence, which is one of the principal characteristics of the PNG political process, he has succeeded in leading his country through an economic minefield. The general problem of low commodity prices, and the hammer-blow delivered to the economy by the closure of the Panguna Mine in Bougainville, could together have prompted an economic collapse. Yet in 1991, PNG had not just bounced hack, hut was recording one of the highest growth rates in the world.

In this interview, Prime Minister Namaliu explains why. He also speaks frankly about the conflict in Bougainville which led to the mine closure, and about some of the vagaries of the democratic system which put him into power.

· Prime Minister, how would you assess Papua New Guinea's current state of economic development. In particular, what have been the development achievements since independence in 1975 and where would you hope to go from here ?

- Our current state of economic development is very satisfactory given our recent history. The Bougainville mine closure and low commodity prices have been the major problems in the last few years and they are ones that would have threatened any economy. But we have come out of these difficulties in good shape and that was only possible because of the tough but necessary economic policies and structural adjustment programmes that we introduced. We have, for example, maintained the value of the kina and have implemented prudent fiscal and monetary policies designed to ensure that things did not get out of hand. As a result, we have managed to come through a very tough situation.

Last year, we saw a considerable improvement on the economic front. Projects like the Porgera and Ok Tedi mines have made a big impact. The estimates for 1991 are that we achieved a positive growth rate of some 9%, after two successive years of recession. This year, it should level out at about 5-6%. Our reserves continue to be strong-in fact in recent times they have been at record levels. In the last three and a half years alone, we approved major investment projects amounting to about two billion dollars, mainly in the mining sector. So, as I said, the current state of the economy in my view is very good despite the problems we have experienced.

· May I ask you more specifically about mineral exploitation, for which PNG clearly has a great deal of scope. Do you think this sector can form the basis for future economic prosperity ?

- I see mineral and oil resource development in this country as underpinning economic prosperity but we obviously need more than that to make it lasting and beneficial. We need to have a strong, efficient rural sector because that is clearly where the majority of our people are and will continue to be. The next stage is investment and this is something we are emphasising a lot more, not just in terms of the policy statements we make, but also as regards actual structural changes. We have abolished the National Development Authority and are replacing it with an Investment Promotion Authority. And, as part of the package, we have also introduced a set of changes that will encourage more investment from overseas' not just in the mining and petroleum sectors, which are obviously significant already, but more particularly in other areas such as agriculture, forestry and fishing. Tourism is also something we are now beginning to address very seriously and of course there is manufacturing. We want, in particular to add value 'downstream' through the processing of resources that we have here. This applies to timber and agricultural products, but obviously we would also like to see it happen in the mining and petroleum sectors.

There is no doubt that mining will boost revenue and will enable us to improve living standards but, as I said, the majority of our people continue to depend on agriculture and fishing for their future. We have, therefore, to achieve a proper balance and to learn from the experience of other countries that have mining and petroleum resources. In particular, we must make sure that we do not squander our wealth in ways that would not help the majority of our people. The only way to do this is to make sure that the benefits from mining and petroleum are used wisely in developing the non-mining sectors. We also have to take steps to ensure that more of our people are literate, educated and skilled.

· Concerns have been expressed that the country's forestry resources are being over-exploited and perhaps even 'pirated'. Indeed there was the Barnett Report on this which criticised the lack of regard to environmental sustainability. What policies is the Government currently pursuing in this area?

- What we have done - partly because of the Barnett Enquiry-is to take some very drastic decisions. Firstly, we abolished the Private Dealings Act. This previously enabled landowners, with minimal government input, to negotiate directly with developers that approached them for the purpose of exploiting their timber resources. That is why, in a number of those projects that were subject to the enquiry, it was found that the developers in fact had very little regard for environmental questions such as reafforestation. The government was not involved in any significant way, other than to rubber-stamp the agreement reached between the landowner and the developer. We have also amended the national forestry legislation completely. We now have in place a new National Forestry Bill which is being implemented and which will result in the establishment of a National Forestry Service. This will be responsible for coordination as well as the development of forestry resources throughout Papua New Guinea. The Board will be comprised of representatives of both government and industry, as well as of the provincial governments and landowners.

Another measure is the Tropical Action Plan. We had a conference here on this to which bilateral and international agency donors were invited. The plan was basically approved and we got a commitment from quite a number of donors to assist us in its implementation. We have now got some help from a number of donors but for the most part we have been very disappointed. We have not received the kind of assistance that donors, particularly from some of the developed countries, indicated they would give. Forestry is seen by people in this country as a means of improving their standard of living and this is often forgotten. In order for them to agree not to have their forests logged-so that, for instance, they can be reserved as some sort of 'world heritage'-you have to have something to offer them. These are the sort of things that are being addressed as part of this Tropical Action Plan and that is why we were hoping that the pledges and commitments that were made at that meeting would have by now resulted in a lot more support than we have got so far. We hope that our critics will understand this and also talk to either their own governments or the international agencies to press for more support to be provided-professional and technical as well as financial. This is a particularly sensitive issue for us but we are prepared to follow the principle of sustainability enshrined in the legislation we have introduced.

As far as the new legislation is concerned, we are now insisting on proper environmental plans as part of a development proposal before it is approved. Under the legislation, there will now be proper mechanisms to monitor that and ensure that steps are taken where a developer is not performing.

· PNG has a very particular cultural history and a way of life which appears not to be based purely on materialism. How can you reconcile the usual development notions of donors with the maintenance of your current cultural values?

-I think that by and large in this country, traditions and customs are still very strong. Even when people have gone into the cash economy, like for example in my area or up in the Highlands, they still have a very rich culture of their own and they would like to preserve this as much as possible. Our task is obviously to ensure that our policies assist them to do this. We have a Ministry of Culture and Tourism and, although in some ways the two areas could conflict, we see no reason why they should not complement each other. Promoting tourism can be a way of strengthening our culture and traditions as long as the people are not manipulated in such a way that commercialisation diminishes their value. That is something that we have to be aware of and it is something that our people are aware of anyway.

As far as government policy is concerned it is very clear that we want to preserve our culture and traditions as much as possible. Where we introduce modern technology and modern instruments of development, we try to ensure that it is done in a way which does not adversely affect our traditional way of life. Having said this, it must be admitted that with the growth of urbanisation things are changing, but I don't think that even in the towns and cities people have necessarily lost their sense of belonging to their own traditions and culture.

· How would you characterise Papua New Guinea's relations with the European Community under the Lomonvention?

-I think they are excellent. Of course, the relationship has been to our great benefit, but also I think to the benefit of the EC. We have obviously been an active member of the ACP group of States and have taken part in the various negotiations. There is no doubt that the EC has been very supportive in PNG's development efforts since we joined and we are very grateful for that. In particular, we acknowledge very strongly the help that we have had from the EC these last couple of difficult years. Our structural adjustment programme has been supported very significantly by the EC and through Stabex we have been able to maintain our prices for all of our major commodities- coffee, copra and cocoa. The European Community enjoys a high priority as far as our foreign policy is concerned.

· You recently faced a potential constitutional crisis involving the Deputy Prime Minister and the Governor-General. What do you think the resolution of this crisis reveals about PNG's democratic system ?

-For a start there was no crisis over the Deputy Prime Ministership. The charges against the Deputy Prime Minister were brought against him personally and did not involve the office which he held except, of course, in so far as his conduct obliged him to resign. The constitutional question obviously arose, however, in respect of the conduct of the Governor-General. He failed to-or refused to act in accordance with-the recommendations of the tribunal and basically left us in a situation where there was no option but to seek his dismissal- which was preempted by his resignation. The whole situation was a sad one, of course, but democracy in this country emerged stronger as a result. So I suppose from an objective viewpoint the outcome was beneficial.

· The Bougainville rebellion continues to pose problems for your Government. What is the current state of play and is there any realistic solution in sight?

-I think so. I think that there will eventually be a solution which will resolve the situation once and for all. It is taking time, but meanwhile we have restored most of the services in the island of Buka and on the smaller atolls. On the northern part of mainland Bougainville we have, during the past few months, been restoring services in close conjunction with the chiefs from those areas. Our security forces have also been there, assisting with that programme, and you might have heard that last weekend there was a major ceremony where the BRA leaders and followers surrendered. They came to make peace with our security forces and made a commitment to give up their arms. So they are working together now and that is very encouraging. I might also add that that part of the mainland actually includes parts of Central Bougainville. I am relatively pleased with the progress that has been made there.

Regarding South Bougainville-and again it includes certain parts of Central Bougainville as well-the leaders have been here in Port Moresby for the last few weeks. The delegation is led by the newlyelected chairman of the interim authority and they have been talking to us about a package which we hope to agree before they go back. Quite clearly, what they want is for us to assist with restoration, but even before that, they have actually got the public servants - over three hundred of them - back to work. Teachers, health workers, agricultural extension workers and so on are actually back on the payroll, and are working with the interim authority in South Bougainville. The difference between them and the north east is that they have, for now, expressed the view that they don't want our security forces to be involved in the programme. They would prefer to undertake the restoration programme themselves at present. They wanted to have their own police but we have told them clearly that under the present constitutional arrangements that won't be possible. But it will be possible for those they have identified to be involved in police work, to work together with our police either as reserve police or as special constables.

So, the only area in the province where we still have a big problem is in Kieta and Arawa where they are holding the Cosmaris. We are not only disappointed about this but very concerned because the understanding on which the ship went in was that they were taking goods and services provided by neutral organisations-NGOs who have been committed to assisting us with medical and other supplies. We are very disappointed that they have reneged on that and are now holding a ship as a means to negotiate for other things which were not part of the initial arrangement. This will affect the willingness of outside organisations such as the Red Cross to arrange ships in the future.

However, I can say that as far as most of the province is concerned we are now gradually restoring the situation. It is becoming clear that the majority of the people just want to go back to leading a normal life and the sooner that is done the better. They cannot say that in public because of the people in the centre who are in control of the guns. If they do speak out, they could be subject to torture and other forms of mistreatment-we know this has already happened and people who have come out have verified it.

But I hope that the approach we have taken, whereby we are not prepared to have any more confrontations or violence, and want to restore peace and services, will ultimately lead to us sitting down with the BRA in the centre of Bougainville. My hope is that these people will see sense enough, like the others have, to sit down with us and resolve this in a peaceful manner.

· What do you think are your prospects for remaining Prime Minister after the Genera/ Election in June ?

-Very good. But, having said that, you may have gathered that in PNG we have a political milieu in which the parties are not as well entrenched as they are in Europe. They are becoming more developed as time goes by, though. In the present Parliament, we have had to make some changes to the electoral law with a view to introducing greater stability in the system. We have amended the provisions relating to votes of no-confidence- previously any government was given a six-month grace period after it took office and we have changed that to 18 months. So, at least that will give the new government a longer period of time to govern before any vote of no-confidence can be moved. Secondly, we have made some changes which hopefully will reduce the incidence of malpractice in the voting procedure. Also, nomination fees have been increased, and will be non-refundable except for those of the winning candidate in each constituency.

· Presumably, this last measure is related to the fact that each constituency contest normally attracts a large number of hopefuls. Do you think it will reduce the number of candidates ?

-Yes, and I also think it will bring out the ones who are committed and serious about standing. Previously a lot of candidates stood simply so that they could split votes - not necessarily because they wanted to win.

· I imagine it will also help to consolidate the party system ?

-It should do that as well. We have another proposal which we will be debating next month (3) which relates to what we call the 'Integrity of Political Parties'. One of the situations it will address is what happens if you decide to switch parties. That has been a problem in the past. Members without a sense of obligation have decided that the grass was greener on the other side. Under the new proposal, they will have to go back and face the people, who can then decide if they approve of the change. That should help the proper development of political parties in this country. So, overall, we are trying to improve our democracy with a view to achieving political stability and prosperity for the future. I am fairly confident that we will get back, and if it happens we should be in a much better position to govern.

Interview by Simon HORNER

Interview with Sir Michael Somare, Minister of Foreign Affaires

Bougainville a 'sensitive and difficult issue'

In this interview, the Foreign Minister (and former Prime Minister) of Papua New Guinea, Sir Michael Somare, outlines how PNG has benefited under successive LomConventions. He also describes the current state of relations between his country and its three closest neighbours Indonesia, Australia and Solomon Islands). On the Bougainville crisis - a running sore for the Government in Port Moresby-he has some sharp things to say.

· Sir Michael, how would you characterise the European Community's current relations with PNG?

-Well I should say that we in PNG enjoy and are keen to maintain the relationship that we have established. Since we acceded to the Lomonvention in 1977, we have benefited very substantially from provisions relating to financial and technical cooperation, trade and investment, regional cooperation and emergency and humanitarian aid.

Through the EDF, we have had grants for development projects in a wide range of sectors, notably directed towards infrastructure, agriculture and training. We have also enjoyed duty-free access to the EC market for our export commodities, such as copra, gold, coffee and agricultural products. This has helped our trading position with the Community a great deal. I should also mention the European Investment Bank, which has provided loans to PNG for the funding of various projects.

In addition we have received aid for the refugees on the border, structural adjustment support, Stabex and Sysmin funds, assistance for our national AIDS programme and help through the South Pacific Regional programmes. All in all, it adds up to a substantial package and obviously it is a relationship which we are pleased to have.

· Turning to your bilateral relations with other countries in the region, I know that there have been some difficulties in the past with Indonesia, particularly on the Irian Jaya border. What is the current state of play ?

-It is true that there were some difficulties in the past involving Indonesia. Soon after PNG became independent, we encountered problems of people crossing. In particular, supporters of the OPM were coming over to our side and this created an awkward situation for us.

I am glad to say that our relationship with Indonesia today is much more mature. The focus is less on the border and instead we are concentrating on other more positive aspects of the relationship. As far as we are concerned, Irian Jaya is an integral part of the Indonesian Republic. How they manage it is entirely up to them. We respect the sovereignty of their territory.

This is a standing policy which has been adopted by successive Governments. Irrespective of who comes to power, they follow the basic agreement on the border which we signed in 1979. The agreement has been reviewed on three occasions, the most recent one being in 1990. These reviews are intended to reflect new developments and new understandings on border matters, particularly with regard to trade. A lot more trade is now taking place between people all along the border. We issue week-end visas for people to go across and they come over on visits as well. It is really going extremely well, from the OPM trying to stir problems but I think they now recognise that we have a better rapport on the border.

On this subject, there is one other important instrument which I should mention. This is the Treaty of Mutual Respect, Cooperation and Friendship between ourselves and Indonesia which was concluded in 1986. It gave a new dimension to our bilateral relations and is based on openness and respect for each other's sovereignty. Our common desire to provide solutions to the border issue has in fact led to an expansion of relations between us. We have now, for example, an exchange of military and technical personnel. Some of our soldiers are trained in one of their military colleges and we are hoping to promote further cooperation between our two defence forces.

Now both governments are about to conclude a further, more substantial agreement on border arrangements. We have already opened a consular office in Jaipur and others may follow. As I have said, we may have had some difficulties in the past, but today the differences have been put aside and we are working together to achieve our common goals.

· What are your relations like with Australia as the former colonial power, on the one hand, and with the ASEAN Organisation on the other?

-We have permanent observer status with ASEAN which I believe is useful. I have attended four ASEAN Foreign Ministers Conferences and through that relationship we have built up very good links with most of the member countries. We receive technical assistance and aid from Malaysia, and are trading with Singapore. Trade with Indonesia has also increased and we have established a relationship with Thailand.

As regards Australia, our relations have always been very good. Our colonial experience was not like that of others and our rapport with Australia is, therefore, completely different. Our links with Australia are also quite unique in the sense that, since granting us independence, they have continued to support our development programmes and to give us grant in aid to subsidise our budget. While, of course, most of the people in our public service are local, we still have Australians helping us out. We also have good defence cooperation as well as cooperation in civil aviation when it is needed. If we need technical assistance, we can always rely on their support.

People might well wonder why it is that we have such a close relationship-perhaps it is something to do with the physical closeness of our two countries, but it is also I think because of the respect that they have shown us as a sovereign nation. Of course, we have had our disagreements, but overall our relationship has been very close.

· May I ask about the Bougainville situation and specifically the effect that it has had on your relations with Solomon Islands ?

It was reported in the newspapers that there was some controversy over alleged hospitality offered in Honiara to BRA (2) leaders.

-Bougainville has been a very sensitive and difficult issue for us and we have always asked neighbouring countries for their cooperation. Solomon Islands and ourselves are members of the Spearhead Group. We hoped that we could cooperate and do things in a Melanesian way, but it does not work like that. The problem of course is that there is a small split between the thinking of the people here and the people of Solomon Islands. I have known the Prime Minister as a personal friend for a long time, and indeed the new Foreign Minister, but I suppose they have their own reasons for not wanting to cooperate. A recent example was when we were seeking an extradition treaty with them. There was a blunt refusal and we don't know the reasons why. They have given us an undertaking that they will not entertain the rebel element on the Islands. Perhaps it is because of the ethnic ties and the closeness of their people. People on our side have relatives on their side. This is not to say that we want to give up with the Solomon Islands Government. We are doing everything we can to get them to understand our difficulties. Of course, they also have to be careful because, if we left the area, there would be a lot of problems for them in South Bougainville.

I believe the Bougainvillians are causing trouble by using Honiara as a base. They are asking us to go to meetings there but our people are not stupid. Nor will we do anything to harm the rebels. If the meeting is held in Rabaul, for instance, they can all go back afterwards. We have given them an undertaking that we will not arrest them if they come to the conference table.

We have been criticised by humanitarian organisations who say we are not being fair, but they should also see it from our viewpoint and appreciate the difficulties that we have. It has been reported in newspapers that we are inhumane but, if you look at what they have done to their own people, you see that the rebels are more inhumane than the PNG Government. I would like you to get the message across to people in Europe that we are very sincere about how we treat human beings. It is their people who are not treated well. They can blame our soldiers, but our soldiers have done their very best. It is exactly the same situation as in Ireland or in parts of Eastern Europe at the moment. So, I hope that people in Europe will appreciate the difficulties we are going through.

· As a former Prime Minister, you obviously have a view on more general issues affecting PNG. What are the next steps in the development process?

-The country has a lot to offer. We obviously have to gear ourselves for mineral development, and this means that the government has to take initiatives to set the pace. We must continue to encourage investment from abroad. We then must ensure that the income derived from that source is used for the benefit of the majority of the people in our country. In particular, we need to provide employment and manpower training, with the resources to back it. Finally, we need to tackle the land problem, which is admittedly a sensitive area. If we do all these things, I think that our prospects will be good.

Interview by S.H.

Cooperation between Papua New Guinea and the European Community

by John LOFTUS

Papua New Guinea, the largest Pacific ACP State in land area and population, is also the most diverse in character. Development plans have therefore to overcome the problems presented not only by separation by sea and rugged terrain but also by the heterogeneity of its peoples, speaking over 700 identifiable languages and living in 20 mainland and island provinces.

Since May 1977, Papua New Guinea has been linked to the European Community, initially through a special arrangement for the application of the Lom trade provisions. It became a full partner in cooperation following accession to Lom on I November 1978.

Through successive Conventions, the cooperation relationship has been significantly strengthened, to such an extent that the European Community is now one of the most important of Papua New Guinea's development partners.

Programmed cooperation

The various instruments of cooperation available under the Lomonventions have been called upon and utilised in accordance with the country's needs. The technical and financing programmable allocations for funding projects have seen significant growth from Lom (ECU 10m) through LomI (ECU 23m) and LomII (ECU 34.5m) to LomV (ECU 40m).

The content of the programmes under which the sums have been spent reflects the major obstacles to be overcome in development of the nation. The major thrusts in the first two Lomonventions were accordingly in road improvements (53%) and education and training, as may be seen from Table 1.

Apart from the road network on the New Guinea side of the mountainous divide, which links Lae to the Highlands provinces, there is no usable road link between provincial capitals and other main centres. Nonetheless, Lomooperation has prudently concentrated on the phased improvement to full bitumen surfaced standard of the existing roads, particularly those radiating from Port Moresby. This policy continued under LomII, where a more noticeable sectoral focus was introduced.

Not unexpectedly, the concentration was on rural development, in which opening up rural access by all-weather roads again figured prominently.

Upon completion of the LomII, Sysmin-funded Road and Bridge Rehabilitation Programme, some 148 km of roads will have been upgraded to bituminous surfaced standard: 51 km from Laloki- Brown River- Veimauri, northwest of Port Moresby (Lom & III); 38 km from Tubuseria-Vailala-Rigo, south-east of Port Moresby (LomI & III), both in the Central Province; 29 km of the Kimbe-Talasea road in West New Britain (LomI) and 30 km of the East Sepik road from Passam-Tuanumbu (LomII Sysmin).

The importance of improving the life of ordinary villagers, who make up some 85% of the population, was given emphasis in the LomII micro-project programmes.

Twenty-three microprojects were completed under the successful LomII programme, all emanating from local community initiatives meeting recognised social, economic, health or infrastructural needs. Projects ranged from building school classrooms and health centres to upgrading a boat-building yard, fish farming, commercial guest houses and agricultural production and water supplies.

A microproject programme devoted entirely to providing water supplies to village communities in five provinces is also in progress.

Training in the rural development context was also a feature of the LomII programme, with added stress on courses in agriculture and the petroleum industry conducted in Papua New Guinea by specialists from Europe.

Training awards for academic courses overseas also continued, bringing to over 300 the number of Papua New Guinea nationals who have undergone tertiary training at post-graduate level in the European Community.

Table 1: EC assistance through the Lom - LomII national indicative programmes (by sector)

A major departure from previous ACP/EC cooperation practice was the agreement that LomV should be valid for 10 years instead of the usual five, with the exception that the financial protocol should run for five years. The first LomV National Indicative Programme was signed in March 1991 and concentrates on two focal sectors; human resources and rural development. The former, expected to utilise about 50%, covers possible support for the University of Papua New Guinea in Port Moresby and the University of Technology (UNITECH) in Lae, tertiary and other secondary institutions as well as teacher-training and other training courses (see Table 2).

Rural development is expected to embrace a further micro-projects programme and provision of rural electrical energy in the form of mini-hydro and solar power facilities. The mini-hydro power plants will generally be on a smaller scale than the one at Tari in Southern Highlands Province, successfully completed in 1989 under LomI, which supplies energy for 24 hours a day compared to the four to six hours of the diesel generator it replaced. There is also provision for a major scheme to conserve Papua New Guinea's tropical forests.

Other, non-focal sectoral measures include a project to develop a capacity for monitoring the environmental effects of mining and a trade and investment promotion programme.

Table 2: LomV - National indicative programme

Structural Adjustment and Sysmin

A most important innovation in the Conventions is structural adjustment. The Government was forced to accelerate an adjustment programme following the closure of the Panguna copper mine in North Solomons Province (Bougainville Island) in 1989 which resulted in a loss of more than 30% of the nation's export income and of considerable revenue in taxes and royalties.

The adaptability of the Lomonventions was demonstrated in the response to the need for balance of payments support by the approval of ECU 5.5m under LomII to fund a sectoral import programme. Here the Bank of Papua New Guinea, the central bank, played a prominent role in facilitating the purchase of foreign exchange by Papua New Guinea importers, there being no restrictive import licensing system in Papua New Guinea. The counterpart fund was used to narrow the national road maintenance budget deficit worsened by the Bougainville mine closure.

The Government was also obliged to seek the assistance of the LomII Sysmin facility, to which a further positive response was forthcoming in the approval of ECU 18m for support of the economy outside North Solomons Province because of the impossibility of implementing projects under the conditions prevailing there. A further sum may be made available for projects in the province when conditions permit.

The amount of ECU 18m was allocated to road infrastructure to permit rehabilitation of roads where the budget deficit has prevented long term maintenance being undertaken. Unspent LomI balances totalling up to ECU 3.5m were added to this sum to fund the Roads and Bridges Rehabilitation programme. This involves upgrading 30 km of road in East Sepik Province, resurfacing 500 km of the major national roads and replacing six bridges in various provinces. Up to ECU 3.5m are for spending on countrywide rural road drainage by labour-intensive methods to help alleviate the effects of unemployment, a consequence of structural adjustment.

The introduction of the adjustment process in LomII has been continued and magnified in LomV. Papua New Guinea automatically qualified for Lomtructural Adjustment support since it already has an agreed World Bank/IMF plan in operation. A LomV Structural Adjustment facility allocation of ECU 7m was agreed by the European Community and this has been augmented by 10% of the NIP (ECU4m). These funds are financing a 'General Import Programme' with the counterpart funds generated making up the education sector deficit in the 1992 National Budget.

Project spotlight- Rural water

The EEC rural water project in Central Province is an integral part of a continuing battle to bring clean and plentiful supplies of water to rural villages in the area. In a tripartite agreement involving the European Community, the Provincial Government and individual villages, the EC is supplying equipment to the value of K453 000 to assist in the installation of solar powered pumping systems. Thirty selected villages benefit from the scheme. Similar projects are being carried out in Sepik and East New Britain. The project is managed by a provincial manager who coordinates a small workforce of five men. It is the manager's responsibility to liaise with village councillors in order to pick work teams of village people who will carry out the l bulk of the manual labour involved. This may mean hand-digging six-metredeep wells or trenching out for up to, seven or eight kilometres of pipework!

Once this establishment work has been' completed, the provincial work team moves in with PVC and polythene pipes made in Papua New Guinea), solar panels and pumps and fits all the pieces together to allow water to be pumped to tanks. These tanks, supplied by the EC, are also made in PNG. In most cases, the water tanks then gravity-feed pipes which run to supply tap-stands in the village. The village women come to these with their plastic containers to collect their water for the day.

The water which flows from the new systems is usually crystal-clear and more pleasant to drink than city water. For the women, the time saved during their working days must run to many hours — an average round-trip for water before the new system was introduced was two kilometres and in some cases it was as much as eight kilometres. Now, the average distance to the water supply is only 50 metres.

The number of people benefiting from the project is approximately 30 000, although more accurate figures are hard to establish as all the villages have fluctuating populations.

Central Province has a number of other water supply projects which do not involve solar power. Mainly rain-catchment and handpump schemes, they are coordinated by the Provincial Health Inspector. Similar projects are being carried out in East Sepik, East New Britain, Madang and Milne Bay Provinces.

David NEWTON, Provincial Project
Coordinator, Central Province


Stabex has proved to be another vital instrument in balance of payments support by helping to make up for the reduction in foreign exchange earnings from agricultural commodities, ie coffee, cocoa, palm oil and coconut products, caused mainly by lower world market prices in recent years.

Papua New Guinea has to date received ECU 153m from the Stabex provisions of the four Lomonventions (Table 3), making it one of the biggest Stabex beneficiaries. The transfers have been used for crop improvement, for agricultural diversification or to support producer prices in the four crops.

The most recent transfer, in respect of 1990, is being used to finance government price support on a reducing scale planned to reach zero within three to five years in accordance with an agricultural plan conforming to the structural adjustment process. An important step was taken by the Commission in 1991 in the conversion to grants of all existing Stabex transfers. All future Stabex transfers will be grants, as are all NIP allocations from LomV.

These measures are aimed at maintaining and improving Papua New Guinea's trading position. The country has consistently experienced a strong balance in its favour as far as trade with the European Community is concerned. (Exports ECU 256m, imports ECU 97m in 1989).

Table 3

European Investment Bank

Valuable loan funding for appropriately viable projects has been made available through the European Investment Bank (EIB). Concessional loans totalling ECU 113m receiving an interest rate subsidy have been agreed for support to projects such as palm oil production (Higaturu and Poliamba), Ok Tedi mine and the Yonki-Ramu hydro-electric scheme.

An indicative amount of ECU 30m was agreed for inclusion in the LomV National Indicative Programme by the EIB.

The most recent EIB intervention and the first contribution from LomV provides a total of ECU 8m (tome IlI- ECU 4m, LomV-ECU 4m) own resources loans and ECU 2m (tome IV) risk capital as a global loan facility in support of small and medium-sized commercial enterprises. The scheme is man aged by the Bank of Papua New Guinea through the agency of the local commercial banks.

Other notable forms of assistance provided were for an AIDS prevention programme and aid to refugees at the camp at East Awin in the Western Province. Food aid totalling ECU 0.8m was provided under LomI in the form of 1200 tonnes of rice, 160 t of canned fish, 30t of milk powder and 12t of vegetable oil.

A further 400 t of rice was provided under LomII. ECU 730 000 was made available under LomII for road construction and maintenance, supply of transport equipment and building of five schools with emergency water tanks. A telecommunications link from this rather remote location has also been installed.

Papua New Guinea received assistance valued at ECU 800 000 from the ECU 35m European Community global AIDS programme in the form of an STD specialist technical assistant, provision of laboratory equipment and funding of seminars and surveys. The technical assistant helped to prepare Papua New Guinea's current medium-term AIDS prevention programme.

Outside the scope of the Conventions, support has been given by the European Community to many small projects through non-governmental organisations. Up to 50% of the value of such projects may be financed.

Regional Cooperation

Allocations of funds have been reserved under the Lomonventions to finance regional programmes. The eight ACP States in the Pacific have benefited from the LomI (ECU 34m) and LomII (ECU 39m) programmes. The LomV regional allocation has been set at ECU 35m. The Regional Indicative Programme was signed in Suva on 28 February 1992 by the Commission and the eight Pacific ACP States.

In LomII, the major projects which are of particular interest to Papua New Guinea are the Pacific Agricultural Programme (ECU 6.8m including sweet potato cultivar research), the Pacific Marine Resources Development Programme (ECU 10.7m-determination of mineral and fishery resources including a tuna tagging programme) and the Pacific Tourism Development Programme (ECU 7.4m).

Table 4: Summary of EC assistance to Papua New Guinea


Through the four Lomonventions, assistance valued at more than ECU 400m (Table 4) has been made available to Papua New Guinea in various forms as major and valuable contributions to overcoming the natural and economic obstacles in its path to developing a better future for its growing population.

Taking account of these difficulties and the brief length of time of its very existence as a unified and independent state, Papua New Guinea has achieved much, managing its affairs in the interests of its people. To its great credit it has done so whilst continuing to embrace the cherished principles of multi-party democracy enshrined in its constitution.

This gives added justification for the cooperation bond between Papua New Guinea and the EC, a bond which continues to strengthen and mature, as reflected in the agreement in 1991 establishing the European Community as a full diplomatic partner under the Vienna Convention. J.L.