Mekere doesnt make sense wiith the sale of Air Nuigini or merger. These are some of my points.

1. If Air Nuigini Merges with Airlines PNG, an airline that seems to be struggling and has a bad saftey record, the new entity inherits airlines PNG bad insurance ratings, APNG’s debt and APNG’s overheads. This puts Air Nuigini in a less favourable position. If Air Nugini was to merge and be put into a better posistion, then maybe a merger with Virgin Airlines would be much better for Air Nuigini and Papua New Guinea.

2. Mekere says Air Nuigini with the new merger would service more rural airstrips. APNG is doing this because thats the market it entered and competition is better for all of us. A merger creates a monopoly again, but this a monopoly like interoils near strangle hold on the fuel prices in PNG. If Air Nuigini want to service more rural airstrips, it could just buy a massive stake into airlines PNG which could go broke if another accident or two happens.

3. He says Air Nuigini needs 800 million or so and cant raise it because of poor financial rating or something. I cant see how a merger with APNG improves this. Anyway if Air Nuigini needed K800 million, why not float some shares on the POM Stock exchange and make it a public company, majority shareholding by the state ofcourse but a large part by us, average brown skinned Indigenous Papua New Guineans, which will give Air Nuigini a legitimate and transparent board in complaince with the Companies act and the POM Sox requirements. This is more transparent.

4. Lessons from Mekere’s past moves. If Mekere floated the PNG BC on the POM Sox, many of us average Papua New Guineans, would have shares in the biggest bank in Papua New Guinea. It would have transparent, duly elected board and not one of this state appointed fiascos’. But thats all history and BSP is here to stay. * please see my notes on BSP at the bottom

5. Mekere merged or whatever, Oregon, an organisation with more value than Oil Search into Oil Search. Why is this important to understand the unbelievable value in state assets. The merger created the biggest company in Papua New Guinea at that time and gave Oil Search the opportunity to develop a stronger relationship with major energy player Exxon Mobil. In 2003 Oil Search sold its stake in the Papua New Guinea Porgera gold joint venture. The company said that it had agreed to sell its interest in the project to Durban Roodepoort Deep (DRD) for $US52.7m cash and $US21.1m in DRD shares. This stake in PJV was originally from Oregon. in 2007, Barrick PNG paid around $US250-million in cash for the DRD stake. When you look at it, the State may have lost $US 200 million or more. * please see my notes on Oil Search at the bottom

6. The Oil Search/Oregon merger gave the PNG Govt a large stake in Oil Search that prevented Oil Search being sold. But the recent Somare government showed how weak legislation is, changing things so that the State’s stake could be traded for bonds, and Oil Search, is no longer a company that will always be ‘Papua New Guinean.’ Oil Search can be bought. And when the day Oil Search is taken over, this whole idea of Oregon, a state organisation with so much potential will finally be dead. * please see my notes on Oil Search at the bottom

7. Even though Petromin is created like Oregon, with so much potential for the good and benefit of Papua New Guinea, short sighted leaders wil destroy it and Petromin may one day be merged, broken up, sold and destroyed.

8. All these State companies were created for a reason, and that is for the benefit of Papua New Guinea. The trouble with many of them is how the top managment and the boards of these institutions are appointed. This system has to change. If not, it gives poorly informed people who call themselves visionaries, people like Mekere and Arthur and Bart Philemon (who once tried to sell Telikom a state asset worth billions for a paltry K150 million to some africans with no money) the ammunition and go forward they need to sell incredibly valuable state assets for peanuts. * please see my notes on Petromin the bottom

9. A proper business school, something like Harvard needs to be created at UPNG to produce economists and first class, highly competitive Papua New Guineans who can reduce the Mekere and his cohorts arguements for the merger and sale of State Assets to weak economic theory that they are based upon, the free market economy and the sale of State assests does not create a just, happy and healthy society. If it did, there would be no Americans travelling to Cuba for better health care.

*Just some notes/disclaimers: I own shares in Oil Search, BSP, and I use to work at Petromin.