From PNG Exposed

The World Bank is pushing the government of Papua New Guinea to open tax free zones across the country where foreign companies can operate duty free and ignore labour and health and safety laws.

Special Economic Zones, as they will be called, are common cross Asia where in fenced enclosures companies operate sweat shop factoies producing cheap manufactored goods for export.

The Zones are notorious for low wages, inhuman living and working conditions and other human rights violations. They also contribute little to local economies as most raw materials are imported and finished goods exported duty free.

The private business arm of the World Bank, the International Finance Corporation, has drafted legislation for PNG that will allow the declaration of Special Economic Zones (SEZ).

The World Bank wants the PNG government to introduce the legislation in  Parliament when it re-sits in November. Before then, the World Bank is financing a on-day seminar in Port Moresby for ‘stake-holder consultation’.

The SEZ legislation is just one more example of the PNG government being co-opted by foreign business interests. While it is highly irregular for national legislation to be drafted outside the country and at the behest of foreign interests, their are similarities with recent changes to Forestry and Environmental laws.

SEZ legislation will completely ignore the spirit and intention of Papua New Guinea’s Constitution and its National Goals but will likely be heavily backed by all PNGs major trading partners including Australia, Europe, the United States and China.

The first SEZ in PNG will be the Pacific Marine Industrial Zone in Madang which will be financed by a loan from the Chinese government. In return 70% of the construction contracts will be handed to Chinese companies with a guaranteed 20% profit margin.