Perhaps this may be of little importance to a boatman sailing to Papua New Guinea purely as a visitor or tourist. But most visitors are interested in what keeps a country ticking and a few comments here may prove of value.
I personally refute the well worn statement that Australia left Papua New Guinea in good economic shape. Sure, in terms of its own western economy, yes, very good shape, but in terms of a country which must now go it alone as a Third World Nation — No!
Take, for example, the plantations. Germans, Australians, English — anyone in fact who owned a piece of the country on which they grew coconuts, coffee or cocoa did very nicely thank you very much. And they continue to do nicely as do the many plantations which are now village owned. But the fact is they only make a profit because they depend on cheap labour. The minute cheap labour finishes so too do the plantations as we know them now.
In an economic climate similar to Australia's but where basic consumer goods are a lot more expensive, the average worker must survive on a basic rural wage of around ten Kina ($12.29 Australian in 1978). The knowledge of this economic imbalance in a country whose people don't know what the word 'strike' or 'bludge' means, mirrored against the Australian worker's constant striking for more and more money, can only warm you to the Papua New Guinean.
As explained later under the heading 'Money', Australian currency was discontinued in Papua New Guinea after independence, being exchanged for the local Kina (instead of dollar) and Toea (instead of cent). At first they were of exactly the same value, but then a strange and unexpected thing happened. The Kina rose against the dollar. It went rapidly from $01.07 to the Kina to a 1978 high of $01.29 to the Kina. Some said it would stop and slide down again once the Kina was floated. It was floated in mid 1978 and it continued to rise. Some said the phenomenom was caused by international support for a new and emerging country. Others said it was because the country was worth more than
Australia, particularly as the price of coffee and cocoa continued to rise on the world market.
Whatever the reasons, there are many Europeans still working in the country, kicking themselves for choosing to be paid in Australian currency. Their lack of confidence is now showing in their bankbook.
It seems highly unlikely that the Kina can continue to float ever higher than the Australian and American dollars, especially if, and when, coffee returns to a sensible level of value. However, Papua New Guinea has already surprised most economic experts and it could do it again. Meanwhile, the economy is buoyant and likely to remain that way for many years as the country moves into true nationhood and finds it level in the international community.
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