Selling To PNG A 'Liability' Wrapped Up In A 'Feel Good' Story?

They say in sales that you don't try to sell the item but you should aim to sell a story and this is a typical example with the story headline 'World's Youngest Airforce PNG Takes To Skies Among Top Guns' heralding in a likely sales deal. The thing with marketers is that they can make us buy things we don't necessarily need.

PNG is becoming the bone yard for run down and retired military gears and it could be the donor's strategy telling us to "stay where you are" by burdening us with unnecessary expenditure.

Do we need such military gear and should we pass the cost of ownership (COO) back to the donors?

As commented by Billy Imar Jnr on his post referred to in this article's cover picture, the Guardian Class patrol boats recently donated by Australia are reported to cost a whopping K100,000+ in fuel costs alone for a single patrol trip. That is money PNGDF don't have or can't afford as per its annual budget allocation.

It is an example of the COO of physical assets. In the acquisition of physical assets, the annualised COO over the useful lifecycle of the asset will be about 1.8 times the acquisition cost. The lifecycle COO covers service and maintenance of the asset to ensure that it is functional and always mission ready. It would be prudent of our GoPNG to do its due diligence by checking at which stage of the asset's life cycle or how many years in life are left of the asset before or at the time of acquisition.

A concept we often don't consider is that all physical assets have an economic life. As assets get near and beyond their design service/useful life, they will become uneconomical to maintain. As a result the COO increases and should we acquire them towards the end of their life, they will become more of a liability than an asset. Budgeting for the upkeep of these uneconomical assets will eat into our national budget. If we can strike the agreement that the donor governments will be responsible for the cost of maintaining and servicing of these assets, then that will be good.

GoPNG agencies that broker such assistance must look at the overall lifecycle COO. This is from a physical asset maintenance and management perspective. Often assets coming to their end of life are disposed to us where they appear to serve the purpose of maintaining 'good international relationships'. Future aids to PNG from donor countries must specify the COO of the assets they disposed from their military inventory and these funds must go directly to maintaining and making mission ready these donated assets.

The biggest threat of physical violence that PNG faces as a country is not from forceful external foreign invasion and acquisition of territory but rather from within our own borders from 'big man' small time warlords who are a clear and present danger to our peaceful coexistence. GoPNG and our State security agencies and authorities need to aggressively go after to remove and eliminate illegal guns and their brandishers with their 'big man' small time warlords, especially, in tribal communities around the country. I covered this in my article below.

We don't need to be burden by uneconomical assets wrapped up in a 'feel good' headline story.