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DOES THE GOVERNMENT ACTUALLY BUY FOOD?

My friend Tanya Zeriga-Alone asked the above question in relation to my earlier post about the need for PNG to increase its internal revenue. And one way it can do that is through a comprehensive import substitution program, with a focus on food.  

Replacing imports by producing our own food keeps our wealth in PNG and our people aren’t robbed of employment and income. It not only makes PNG food-secure but most importantly lifts our citizens out of poverty. There is already a ready market for the food in PNG. And an increase in economic base and employment means more tax revenue for the country.    

For example, Thailand’s strong import substitution development policies of the 1980’s and 1990’s reduced poverty from around 60% to 13% by 2004. The World Bank figures show that Thailand has the best record for reducing poverty per increase in GNP of any nation in the world.      

Now, let’s get back to Tanya’s questions: “Does the Government actually buy food? So what does it do with it?”    

Private consumption expenditures by households in an economy is accounted for by the government as its consumption. So to calculate its GDP [income], the formula is GDP = Consumption + Investment [by private businesses] + Government Spending + [Export minus Import].  

When you buy rice at the shop, you are actually paying a farmer in say Vietnam. That money goes to the rice importer [say Trukai] and eventually gets transferred to the Vietnamese farmer. The PNG Government records that as its imports.  

I believe the answer to PNG’s prosperity lies in agriculture, and particularly food production and how the nation feeds itself. We can earn money from oil, gas, mineral, copra, nickel, etc, and will still spend it on food every day.  

For example, everyday millions of plates of rice is served and eaten by Papua New Guineans throughout the country. Papua New Guineans consume an average of 400,000 metric tons of rice annually. PNG government records this as its consumption. Papua New Guineans transfer an average of K700 Million of their hard-earned money overseas every year to buy rice. The Government records that as its imports.    
 
Now, let’s get back to the GDP formula. And IMAGINE!
 
▪ PNG keeping K700 Million per year to buy rice produced by PNG farmers;
▪ K400 Million per year to purchase milk produced in PNG; and
▪ K200 Million per year to purchase chicken raised in PNG.  

That is already saving K1.3 Billion for just 3 food alone, creating employment for thousands of people, growing our economy and lifting people out of poverty.    
 
Let’s ask ourselves:    

▪ Can Papua New Guineans grow rice? If so, why is the National Rice Policy not implemented, discussed nor funded?
 
▪ Can Papua New Guineans raise chicken? If so, why are we continuing to import K200 Million worth of cheap chicken, to compete with our chicken farmers, kill our poultry industry and send thousands of Papua New Guineans into poverty and hardships?
 
▪ Can Papua New Guineans plant corn that can produce stockfeed?
 
▪ Can Papua New Guineans grow grass and maize to feed the cows?
 
▪ Do Papua New Guineans need specialized University degrees and skills to plant rice, raise chicken, plant corn, potato and grass?
 
▪ Haven’t we Papua New Guineans been farmers cultivating our land for thousands of years, just after the Garden of Eden?    
 
Shalom Beloveds. Tingting! #TogetherWeCan

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Image 📸: IAI’s Kuk Chips food stall at Vision City, Port Moresby. [We can produce our own potato chips and give K150 Million every year to our farmers, replacing potato chips]🤷‍♀️🇵🇬

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