Will Skate's resignation put end to PNG crisis
Will Skate's resignation put end to PNG crisis
By Paul Tait
SYDNEY (Reuters): Taiwan's newest friend in the community of nations could be about to turn its back after Bill Skate's resignation as prime minister of Papua New Guinea.
But analysts warn that it's still too early to write off either Skate -- or the controversial deal he engineered with Taipei to rescue his South Pacific nation from economic crisis.
Skate, who had faced a no-confidence vote when parliament resumes on Tuesday, handed in his resignation on Thursday but made clear he would fight to resurrect his leadership.
PNG experts said a Lazarus-like revival was not out of the question given the country's idiosyncratic approach to democracy.
"In one way it seemed to make sense because he just didn't have the numbers but there could be a trick up his sleeve, he could make a deal with someone else," said Theo Levantis, PNG specialist at the Australian National University (ANU).
"What he's doing is unpredictable because he might try anything to give himself some sort of chance," Levantis said.
Muddying his demise was Monday's deal to turn away from long- standing ties with China and recognize its diplomatic rival Taiwan.
Official documents obtained by Reuters showed Skate went to Taipei with a shopping list seeking US$2.35 billion in financial help -- enough to wipe PNG's entire government debt.
The deal sparked regional disquiet and its future is now the subject of as much conjecture as that of Skate himself.
Former Skate ally Sir Mekere Morauta, seen as the frontrunner to succeed Skate, said on Wednesday he would review the Taiwan deal and its implications should he win the prime minister's job.
He told Australian Broadcasting Corporation radio: "As a new government I have flexibility to review everything, including that (the Taiwan deal)."
"It's something I'd have to be very careful (about) because it's not just between Papua New Guinea and Taiwan. There are regional and international implications and I'd have to be mindful and sensitive to that."
Morauta's People's Democratic Movement (PDM) deserted Skate's fragile coalition 11 days ago, and now claims to control 81 seats in the 109-seat parliament.
Talking about what Skate, Levantis told Reuters: "He must have something up his sleeve somewhere because it's a strange decision to arrange the deal more or less the day before (his resignation)."
Some believe the ace up his sleeve might be the example set by Sir Paias Wingti, who quit as prime minister in 1993 only to re- nominate the following day.
"He might be doing the Wingti thing, he might have made some sort of deal where he might get a second in line post," Levantis said from Canberra.
Skate himself hinted at such an outcome after formally handing his letter of resignation to Governor Gen. Sir Silas Atopare on Thursday, saying he believed he would be "in the first three" at an election.
Skate managed to avoid the no-confidence vote longer than expected, deciding last December to adjourn parliament for seven months at the end of his statutory 18-month grace period.
Analysts believe his next move might be to sponsor a new candidate to save his PNG First government.
Others say international markets will welcome Skate's demise after PNG's economy nose-dived during his tenure.
Droughts which hit hard at PNG's important resource exports like minerals, timber and palm oil and the Asian economic crisis were beyond Skate's control.
His government has been forced to use interest rates to protect the vulnerable kina currency, sparking a vicious cycle of inflation and currency depreciation.
The International Monetary Fund (IMF) and the World Bank both balked at overtures from PNG and talks stalled over structural concerns. The IMF warned in March PNG faced a "looming financial crisis" due to a surge in government spending.
"I suspect that this will be some comfort to international monetary markets and that is certainly important because the kina has been plunging, inflation has been rising," Hank Nelson, history professor at Canberra's ANU, said of Skate's resignation.
"The Taiwan move must have put some alarms into the international economic community," he said.
As for the political future, analysts say Western notions of loyalty matter little in the South Pacific nation of 4.5 million people where corruption is endemic, tribal ties are paramount and votes can still be bought in exchange for pigs.
"Loyalty is very, very sparse in the PNG political context," said Sean Dorney, the Australian Broadcasting Corporation's veteran PNG observer.
The rough-edged Skate succeeded Sir Julius Chan, who was voted out after the Sandline mercenary fiasco. The former Port Moresby mayor sidestepped the traditional kingmakers of PNG politics to cobble together a coalition for his PNG First party The coalition fell apart when the PDM quit.