Bougainville Referendum - Potential Implications for Australia on Papua New Guinea's Response - Literature review Example

Bougainville Referendum--- Potential Implications for Australia on PNG Response Name: Student ID: Institution: Course: Table of Contents i.Abstract 2 1.0.Introduction 3 2.0.How Bougainville Referendum Reflects Papua New Guinea and Australia Sovereignty 5 3.0.Diplomatic Implication of Island of Bougainville Referendum to Australia 7 3.1.Papua New Guinea Sovereignty Concerns over Australia 7 3.2.Australia–Papua New Guinea Diplomatic Fracas in 2015 10 4.0.Economic Implication of Island of Bougainville Referendum to Australia 11 4.1.Collapse in Timber Trade and Exportations for Australia 12 4.2.Australia’s Possible Economic Relations with Papua New Guinea after Referendum 13 4.3.Labour Mobility 15 5.0.Military Implication of Island of Bougainville Referendum to Australia 16 5.1.Likely Collapse of Papua New Guinea and Australia Defense Cooperation 17 5.2.Likely Collapse of Military Deal between PNG and Australia on South Pacific 18 6.0.Conclusion 19 i. Abstract The slogan, “we are the indigenous people of motherland Bougainville. We alone have to decide our future, our destiny. No outsider can decide for us” is statement that has not been resonating well with Australia; diplomatically or militarily. One issue that such slogan suggests is the likely response of Papua New Guinea (PNG) to the Island of Bougainville referendum on independence. This paper critically assesses some likely diplomatic, economic and military implication of Papua New Guinea response to the ultimate referendum and how such implications will affect Australia. At the moment, there are a number of strategic and political dynamics of Bougainville’s promised referendum which if looked keenly, may affect Papua New Guinea longstanding economic, military and diplomatic links with Australia. Scholars have debated that the likely implications of the referendum to be held between 2015 and 2020 have different implications but these implications remain multifaceted as policies and frameworks that shape such implications emerge every day. The assessment builds on recent developments in Australia, Papua New Guinea and Island of Bougainville to ascertain a number of significant risks, primarily located in the period before and after the vote. These are however, connected to likely frustrations should legal impediments for instance, be raised to the holding of the referendum, issues linked to the resumption of mining and the role of spoilers, in differing expectations between the Papua New Guinea Government and people of Bougainville over the outcome and how such will spill over to Australia. This assessment argues that there are possible economic, military and diplomatic implications between Papua New Guinea and Australia as far as the referendum is concerned. While it is uncertain what the outcome of the referendum could be, it is certain that the outcome of the voting process will have serious economic, military and diplomatic consequences to Papua New Guinea and Australia. 1.0. Introduction Between 2015 and 2020, Island of Bougainville is expected to hold a referendum on her political future. While this process is welcomed, researchers are not concerned about the implication of this process to Australia, should Papua New Guinea decide to break some diplomatic and military ties it currently has with Australia (Ghai and Regan, 2006; Lawson, 2016). ‘Bougainville Peace Agreement’, signed in 2001 for instance, has some serious implications on the relationship Papua New Guinea and Australia will have to each other following the assured Bougainvilleans a referendum tipped to include the option of independence, after a prescribed period of autonomous government. To contextualize this point, Fanselow (2015) argues that in Canberra the views from orthodox remains that Bougainvillea referendum or ultimate independence would complicate Australian military, strategic and diplomatic movement. That is, such independence could destabilise both Papua New Guinea and Solomon Islands. The meaning of such destabilization is that military and diplomatic ties between Australia and Papua New Guinea may be inevitably weak possibly due to internally conflicted states needing external help for an extended period. Concerns regarding the possible response of Papua New Guinea to the referendum was noted when Australia’s formal position on Bougainville’s independence was neutral (Denoon, 2012). Noting possible reactions from Papua New Guinea, the then Australian Foreign Minister Alexander Downer noted the concerns of possible reactions from Papua New Guinea should Bougainville secede terming the possibility of referendum as, ‘Australia will accept any settlement negotiated by the parties’ (Transparency International, p. 273). Based on these concerns, it important to assess the key diplomatic and military consequences of Bougainville secession if Papua New Guinea have different perspective on Australia who have for long, hoped that Bougainville remain part of Papua New Guinea. The possible consequences of the cessation remain multifaceted as far as economic, diplomacy and military are concerned. However, this paper will identify potential implications for Australia during the preparations, conduct and aftermath of the process of voting. To attain this goal, this paper is set out in four parts before conclusion. The first part provides explicit review of current economic, military and diplomacy ties between Papua New Guinea and Australia. The aim of this section is to provide a framework that helps in understanding potential economic, military and diplomacy implications for Australia should Bougainville gain their independence. The second part relates the identified economic, military and diplomacy ties with possible problems that can arise both to Papua New Guinea and Australia. This entail issues linked with attaining the pre-set conditions for the plebiscite such as good governance and disarmament. The third part concentrates on the aftermath of referendum and the sustainability of the previously held economic, military and diplomacy ties between Papua New Guinea and Australia. This is the area where the outcome of the referendum will be tested. Finally, the conclusion of the assessment will summarise critical findings of the assessment. The conclusion will draw on different perceptions and researches that have been conducted on the thesis statement and note the possible ramifications for regional economic, military and diplomacy sustainability between Papua New Guinea and Australia. 2.0. How Bougainville Referendum Reflects Papua New Guinea and Australia Sovereignty Researches have noted that the best approach in understanding the potential implications for Australia on the basis of how PNG might respond to the Island of Bougainville referendum is by first providing basis for key features of Bougainville referendum. That is, the expectations and interests Papua New Guinea and Australia have on the referendum. First, the aim of the referendum was to compromise the previously opposing positions. According to Wolfers (2007) Bougainville has been concerned by amount of force exerted by Papua New Guinea government and as a result, they have been seeing referendum as the best way of balancing those forces. This position can be seen in the Bougainville Peace Agreement (BPA) that was signed in Arawa on 30th August 2001. On the other hand, Australia had been showing interest as far as immediate autonomy of Bougainville is concerned (Radan, 2012). The two conflicting position have been seen as a process that was going to result into economic, diplomatic and military row between Papua New Guinea and Australia. Secondly, the genesis of economic, diplomatic and military row between Papua New Guinea and Australia can be seen when Australia helped Bougainville when negotiating with PNG and such negotiations bound both PNG and Bougainville. Wallis (2012) notes that in as much as PNG opposed the referendum (because PNG government was seeing it as an affront to the sovereignty of PNG), Australia exerted external force making PNG to agree to the terms. It therefore means immediately after the convention in Arawa, PNG had started developing economic, diplomatic and military row with Australia. According to Tierney et al. (2015), the intervention of Australian government in December 2000 was the process that was seen to be the start of economic, diplomatic and military row for the two countries. For instance, between 1997 and 1999, Australia held that Bougainville was integral part of PNG. During this period, researches noted that economic, diplomatic and military relationship between Papua New Guinea and Australia was strong (Woodbury, 2014). These researches help the assessment to understand that the possible implication of referendum on economic, diplomatic and military relationship will be only be as a result of the expected referendum in 2020 but something that has been simmering since the first time Australia started showing interest in the cessation of Bougainville from Papua New Guinea. Additionally, the possible cause of eminent economic, diplomatic and military crisis between Papua New Guinea and Australia before and after referendum originate from failed assurance (the assurance came from Downer) from Australia that PNG was still going to have its total sovereignty if the outcome of referendum was not going to bind and ultimate authority was still going to rest with the PNG Parliament (Commonwealth-Pacific Islands Forum, 2005). However, recent economic and diplomatic developments in Australia have made PNG suspicious. These developments have made scholars to be concerned of possible implications that the outcome of the referendum will generate as far as diplomacy, economic and militarism between the two countries are concerned (Woolford, 2013; Dinnen and Peake, 2015). 3.0. Diplomatic Implication of Island of Bougainville Referendum to Australia 3.1. Papua New Guinea Sovereignty Concerns over Australia As noted in recent reports and case studies, there a reason to assess the Papua New Guinea sovereignty concerns over Australia. While the sovereignty of Papua New Guinea is already a concern, Bougainvillean suspicions regarding the motives of Australia would need to be dealt with sensitively (Glazebrook, 2014). This process should be managed sensitively given all side’s strong interests in preservation of peace. However, Glazebrook (2014) notes that neither independence nor autonomy would be an outcome which would necessarily exclude or ensure the possibility of violence especially between Australia and Papua New Guinea. The essential position researchers hold is that the process of voting be conducted reasonably well so that there is realistic balance between independence and autonomy. However, there is a challenge and such challenge has been argued with regard to military complication that can arise between Australia and Papua New Guinea. Regan (2014) for instance noted that Bougainville presents possible rewards and risks for the new government, but the greatest military risks arise from Canberra’s inactivity. In such cases, Australia may show that they have the power and resources more than just sending military forces---that Australia has the resources and nous to avert the need for military interventions through concerted government interventions to create the conditions for lasting solution between Papua New Guinea, Bougainville and Australia. In many ways, Regan (2014) sees that Papua New Guinea might want to impose some restrictions to Australia, a move that would resurrect the story of Pacific stabilisation stared by the Howard government in Bougainville. If this arises, the potential implication is that Australia will seek for preventative diplomatic strategies that may be conducted in close cooperation with other partners. Even before the establishment of the referendum, diplomatic ties between Papua New Guinea and Australia are soaring. According to recent political developments in Papua New Guinea, the possible outcome of Bougainvillean referendum has made Papua New Guinea to ban Australians from traveling to the Autonomous Region of Bougainville (Maclellan, 2015). While scholars such as Regan (2014) argue that such decision were made because Canberra announced its plans to open a new diplomatic missions on the island, these diplomatic implications have been largely caused by Papua New Guinea’s response to the Island of Bougainville’s referendum. On the other hand, some scholars have argued that indeed the decision by Papua New Guinea to soar diplomatic relationship with Australia was as a result of Australia decision to ban Papua New Guinea’s citizens from freely accessing Australia (Maclellan, 2015). This position is well supported by the reactions from Papua New Guinea’s foreign minister Rimbink Pato who called such diplomatic row “referendum instigated outrageous move’ (Hermes, 2014, p. 362). As a matter of fact, the diplomatic response from Australia decision was swift where the foreign minister responded by saying, "I have instructed the chief migration officer to impose the ban with immediate effect and to notify all PNG Overseas Missions and Posts and domestic carriers of the ban" (p. 262). The potential diplomatic implications for Australia on the basis of how Papua New Guinea responds to the Island of Bougainville referendum is that already, even before the actual date of the referendum, both Australia and Papua New Guinea are suspicious. This position brings another aspect of looking at the possible diplomatic implications of the referendum to Australia and Papua New Guinea. Researches have indicated that Australia has had interest in opening diplomatic missions to Bougainville especially if it (Bougainville) becomes independent (Hennings, 2015). Such policy reforms and decisions have received sharp criticism especially when Australian government started showing diplomatic interest in the Autonomous Region of Bougainville. These develops have really concerned Papua New Guinea government to an extent that PNG’s Prime Minister Peter O’Neill noted, “we were shocked to learn from the budget documents that Australia was planning to establish a diplomatic post in Bougainville ... We have to sanction this. You can't just go around and open offices at your pleasure” (Wallis et al. 2016, p. 262). However, this position was quickly corrected by Julie Bishop, Foreign Minister who noted that as far as diplomacy is concerned, Papua New Guinea was consulted on the diplomatic missions in Bougainville in late 2014, adding that Australia's High Commissioner officially notified Papua New Guinea government prior to the budget. The interpretation of these misunderstanding is that diplomatically, Papua New Guinea government is already suspicious that once Bougainville becomes independent in 2020, there are likely to be diplomatic integration between Australia and Bougainville to frustrate Papua New Guinea government or sovereignty. As a matter of fact, Sasa (2013) notes that these diplomatic developments are likely to generate civil war as those witnessed between 1980s and 1990s. With Bougainville receiving autonomy status, the Australian announcement that it would open a post in Buka came while elections were underway in Bougainville, a move that has really concerned Papua New Guinea. 3.2. Australia–Papua New Guinea Diplomatic Fracas in 2015 The possible implications of the Bougainville referendum can be seen from 2015 diplomatic fracas between the two neighbouring countries (Australia and Papua New Guinea). The diplomatic relationships between the two countries have indicated that regardless of the outcome of the referendum in 2020, there will be little understanding between the two countries. 2015 has culminated into diplomatic fracas regarding Department of Foreign Affairs and Trade (DFAT) to establish consular post in Bougainville, a ban on Australian poultry imports, a ban on exportations of vegetable from Australia, Australia’s High Commissioner Deborah Stokes sentiments that foreign advisors working in Papua New Guinea and harsh ad hominem criticisms of Treasury official Paul Flanagan on their stance on diplomatic rows indicate that Bougainville referendum will ultimately cause a situation where Australia and Papua New Guinea not only breaks the Organic Law on Provincial Boundaries but causes serious disintegration on their diplomatic ties to an extent that peace-building in Bougainville may not be realized (Tierney et al. 2016). Together, there is possibility that these issues could be diplomatic crisis for the two countries after 2020. Studies that have argued that the state of Australian diplomatic relationship with Papua New Guinea should be seen as a barometer of Australian foreign policy success find that Australian should be worried more than Papua New Guinea because the fracas that have brewed in 2015 could signal serious economic implications for Australia after 2020. There will be likely incidences of bumps in the Australia–Papua New Guinea diplomatic ties before and after the 2020 referendum. In as much as scholars such as Schneider (2012) have argued that a well ratified political stewardship may avert what seems to be critical even before the referendum, evidence based studies together with the current diplomatic turmoil in the two countries suggest that the future remains oblique. Schneider (2012) notes that regardless of the outcome of the referendum, there is likely to be unpredictable elements from both countries that will create problems that may not be easy to solve and thus there will be a wider discontent between Australia and Papua New Guinea leaders and citizens. To contextualize this argument, the Australian Government’s move to depend on Papua New Guinea to run the Manus Regional Processing Centre as a central unit of its asylum in just one of the key areas researchers predict will be fragile with the growing concerns in diplomatic ties between the two countries (Robie, 2012). 4.0. Economic Implication of Island of Bougainville Referendum to Australia For decades now, Australia has been valuing economic ties that have existed between them and Papua New Guinea. To Australia, Papua New Guinea has not only been a neighbor but a country that has offered Australia trading partner. As a matter of fact, Kirschner (2015) argued that the economic interest Australia has in Papua New Guinea is enormous that destabilization of the relationship between the two countries may hamper economic progress of Australia. Despite this position, the uncertainty of the outcome of referendum in Bougainville makes it possible to argue that the economic ties enjoyed by Papua New Guinea and Australia may be disintegrated thus causing enormous economic loss to Australia. 4.1. Collapse in Timber Trade and Exportations for Australia Based on expert opinions (see Ducan Brack research on Illegal Trade in Natural Rescources), Australia is a strong beneficially of Papua New Guinea’s natural resources including timbers. According to Judge Barnett’s report, timber industry has been thriving Australian economy with what the judge terms as “country’s roaming the countryside of Papua New Guinea with assurance of robber barons, bribing politicians and leaders to take the valuables back to their country’ (Reilly et al. 2014). This position is critical in understanding how the Papua New Guinea might respond to the outcome of Bougainville referendum. From the one hand, Papua New Guinea may decide to close its economic ties with Australian imports and exports owing to the fact that Papua New Guinea has never supported cessation of Bougainville but Australia has. This response in return will mean that Australia will have serious materials supply to their timber industries. Hermkens and Timmer (2012) assesses this position differently arguing that if Papua New Guinea responds by imposing restrictions on logging what have been taking place within their borders then Australia is likely to suffer substantial revenue collection from the same. This case can be related with the Cambodian rogue forces (Khmer). The forces used to trade on logs from neighboring countries. However, after these countries closed their borders the forces suffered economic losses opting to negotiate peace talks with these countries (Matthew, 2000). Recent announcement titled, “timber industry in bid to join monitoring club’ (The National as cited in Wallis, 2016) is an indication that Papua New Guinea is already considering breaking ties with Australia as far as trade in timber is concerned. Tony Honey, the president of PNG Forest Industries Association (PNGFIA) noted that the association strongly disagrees with illegal logging in Papua New Guinea from countries such as Australia and that all timber exports will only be to members of the association. This move technically locks out Australia as it is not among the members of PNG Forest Industries Association. This decision comes even before the actual date of referendum. In as much as this position was welcomed by the David Eldridge, Australian Timber Importers Federation, there were concerns from different political divides in Australia that the decision by Papua New Guinea was ‘Bougainville Referendum Fever’ and was likely to hurt the economic progress of not only Australian Timber Importers Federation but the rest of Australian in general. The position here is that Papua New Guinea is already making attempts to close economic ties with Australia as retaliatory approach towards the support Australia gave to process of cessation (this position can be seen in the BPA that was signed in Arawa on 30th August 2001). 4.2. Australia’s Possible Economic Relations with Papua New Guinea after Referendum Concerns that have been raised are that Papua New Guinea may respond by altering its economic relations with Austria after the referendum. It is apparent, and it is in tandem with Pacific Economic and Political Community that Australia and Papua New Guinea depend on each other economically (UN Development Programme, 2013). For sustainable development between the two countries to be there is need to look at issues beyond Bougainville referendum. Currently, Australia and Papua New Guinea have clearly defined strategies of attaining economic sustainability, agendas of tackling economic challenges such as poverty and economic wellbeing. Despite this position and the efforts that have been made by Pacific Economic and Political Community, response that Papua New Guinea may have regarding the outcome of Bougainville referendum may change the economic ties the two countries have been having. Australian economy is characterized by dependence on the production of raw materials such as minerals, copra, and timber among others. However, some of these materials come from Papua New Guinea. With the outcome of the referendum almost certain (most of Bougainvillean are supporting cessation according to recent opinion polls), Papua New Guinea will certainly respond by reviewing its economic relationship with Australia. What will follow therefore will be Australian economy dependent so much on raw materials from Papua New Guinea which after 2020 may be raw commodity decreased in terms of price. Boege and Franks (2012) noted that the trade between Australia and Papua New Guinea will be increasingly liberalized. Boege and Franks (2012) further found that since Papua New Guinea is already having low purchasing power and considering ways in which to weaken economic ties with Australia, the response of Papua New Guinea as a result of the referendum might be to consider countries such as Fiji as their new external markets with intra-regional trade being nominal. Either way, these decisions may affect the economic situations in two critical ways; firstly, this will mean that Australia may experience limited capital market access and a high dependence on imports from other countries. Secondly, there will be unprecedented economic implications for Australia should Papua New Guinea decides to partner with other countries. This was the same view noted by Pacific Economic and Political Community when they recommended that Australia need to forecast possible economic responses from Bougainville referendum so that she can continue enjoying sustainable and acceptable economic relations with Papua New Guinea and all the Pacific island countries who may be against Bougainville referendum. Based on non-tariff barriers to trade, there is three distinct ways of assessing how economic relations between Papua New Guinea and Australia may turn to be after referendum. First, after the referendum, Papua New Guinea might respond by imposing restrictions and difficulties when Australia make attempts to obtain export permits for the export of goods such as chicken or timber. Secondly, Papua New Guinea may create trade barriers when it comes to the importation of some crops from the country. That is, after the referendum there is a possibility that Papua New Guinea may re-examine some of its basic rules including quarantine procedures to ensure that they are really in tandem with the created boundaries between Papua New Guinea, Australia and the Island of Bougainville. Thirdly, there may be challenges with the exportation of Australian food related products to Papua New Guinea and other Pacific Island countries for reasons emanating from the referendum. The economic implication of these positions is that the Australia’s advocacy for economic self-sufficiency may suffer. For the last 5 years or so, economic development of Australia has been based on Australia’s ‘economic self-sufficiency as well as fiscal reform’. However, with Papua New Guinea likely to take a different direction after the referendum, this premise with which the slogan is held will be disintegrated. These concerns were also noted in the Forum Economic Ministers’ Meeting (FEMM) and Forum Trade Ministers’ Meeting (FTMM) (Wallis, 2014). 4.3. Labour Mobility One of the economic benefits Australia has enjoyed from the unified Papua New Guinea (with Bougainville being part of Papua New Guinea) is labour mobility. In point of fact, Wallis (2014) notes that during Forum Economic Ministers’ Meeting and Forum Trade Ministers’ Meeting it was found that Australia benefit by almost 35percent of labour mobility to Papua New Guinea than any other pacific countries in the region. This means that economically, Australia has benefited from Papua New Guinea with regard to seeking employment from Papua New Guinea or receiving expertise request from Papua New Guinea on some technical or technological issues. Estimation by UN Development Programme (2013) found that annually, Australians send home A$ 2,500,000 to 7,000,000 as a result of labour mobility specifically from Papua New Guinea. It therefore means that should Bougainville become a sovereign state, Papua New Guinea may consider such a scheme with a view to providing newer models from which to develop ways in which Australians move to the country. The Australian Council of Trade Unions (ACTU) is already cautious about new developments in Papua New Guinea with regard to labour mobility (Asian Development Bank, 2012). The implication this position may have as far as economic development of Australia is concerned is that the capacity of Australia’s labour mobility in Papua New Guinea may be affected. Restrictions on labour mobility would also mean that Australia may suffer in having casual labourers from Papua New Guinea especially in the periods of harvesting. In summary, with the restrictions and recent bans Australia has imposed on Papua New Guinea, the referendum may pave way for Papua New Guinea to recommend that its government (Papua New Guinea’s) no longer supports Australian industry groups, State governments, unions, Non-Government Organisations and regional governments in developing a pilot program to allow for labour to be sourced to and from Papua New Guinea. 5.0. Military Implication of Island of Bougainville Referendum to Australia Aside from the eminent Bougainville referendum, the military relationship between Papua New Guinea and Bougainville has been very strong. The relationship is not only transcending from colonial period but it has been one based on history and shared experiences. As a matter of fact, Woodbury (2014) argued that contemporary Papua New Guinea Defence Force (PNGDF) units can trace their regimental military history to Papuan and New Guinea units formed as a result of the Australian Army as well as Royal Australian Navy before and after the Second World War. The strong relationship was once exemplified by Brigadier Caughey who noted in an interview that Australian military and Papua New Guinea Defence Force have had a long history of exercising in Papua New Guinea and also hosting PNGDF members in Townsville” (Dinnen and Peake, 2015 pg. 62). Despite the good relationship that has existed between Australia and Papua New Guinea Defence Force, the eminent Bougainville referendum of 2020 continues to draw mixed reactions regarding what might be the relationship between the two countries. Scholars have argued that the Papua New Guinea response regarding Bougainville referendum might bring to an end the long standing military relationship that has been enjoyed between Papua New Guinea and Australia (Lounsbery and Cook, 2015; Maclellan, 2015). 5.1. Likely Collapse of Papua New Guinea and Australia Defense Cooperation One of the key fears that researches have talked about regard to possible response of Papua New Guinea regarding the outcome of Bougainville referendum is that Papua New Guinea may cease cooperating with Australian military forces (Fanselow, 2015). Currently, there exists stable military relationship between PNG and Australia under the umbrella Defense Cooperation Program (DCP). The program has indeed benefited both countries and specifically, DCP has helped PNG in the development of capable and sustainable PNGDF. On the other hand, PNG through PNGDF have helped Australia in the stabilization of borders, disaster relief, supporting major national projects. In May 2013, there was signing of Defense Cooperation Arrangement where both countries expressed their deepest desires to cooperate. One of the main frameworks that guided the signing of agreements was that PNGDF was to help Australia in guiding their growing investment and expansion of border controls. However, with the 2020 referendum, PNG will be feeling that Australia’s support of Bougainville will violate their military defense frameworks that the country set in the 2013 PNG Defence White Paper (Fanselow, 2015). Colonel Dick Parker, the current Defence advisor to PNG (the advisor is known in PNG as Head of Australian Defence Staff – HADS) noted his concern that the military relation between Australia and PNG may be undermined once PNG reviews its policy frameworks in PNG Defence White Paper after the 2020 referendum (McKenna, 2015). 5.2. Likely Collapse of Military Deal between PNG and Australia on South Pacific One of the likely responses of PNG form the referendum is that PNG may rethink their position regarding the deal signed between Australian military and PNG military regarding South Pacific. The inaugural South Pacific Ministers Meeting that was held in Tonga noted the need for PNG and Australia militaries to cooperate towards strengthening South Pacific (Maclellan, 2015). A point of concern is that the arrangement that was signed when Julia Gillard made first trip to PNG as prime minister aimed at promoting education of military forces from sides, inter-border relief cooperation and updating trade. However, should Bougainville referendum decide that they is time to secede, then there is concern that Julia Gillard efforts to unify the two military forces may be derailed. Given PNG’s central place in the South Pacific, a collapse in the deal may mean serious military challenges between the two borders whereby issues such as stability and cohesion, commitment to regional security and weakening strategic partnership will be of concern (Maclellan, 2015). In particular, Maclellan (2015) argues that should PNG decide to end military cooperation due to the election, it would mean that principles-based statement will be affected. This view was supported by Fanselow (2015) who noted that this response may affect region-wide joint training opportunities that existed under New Regional Exercise Framework.’ 6.0. Conclusion The key issue which is the potential implications for Australia on the basis of how PNG might respond to the Island of Bougainville referendum on independence to be held at a point between now and 2020 remains multifaceted. At the moment, military, economic and diplomatic relationship between PNG and Australia remain uncertain even before the referendum. This aspect has been complicated by the fact that presently, Bougainvilleans and the PNG Government seem to have differing expectations on what the outcome of the referendum will have on Australia. This seems to be the same case with regard to Australia. This assessment has found that should PNG decide to review her initial stance and relationship with Australia, the former is likely to suffer the biggest as far as their economy, military and diplomacy is concerned. Presently, in as much as views on Bougainville remain uncertain and to some extent unanimous, key diplomatic, military and economic decision that PNG have been making suggest that their response will not be favourable to Australia regardless of the outcome of the referendum. 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