Despite being the largest country in the Pacific and the closest to Australia, Papua New Guinea finds itself with declining international services. A solution would be to give businesses an incentive to expand, ROHAN FOX writes.
PAPUA New Guinea has been in the grip of foreign exchange shortages and rationing for the past six years.
This has been listed by a Business Advantage PNG survey of business leaders as one of the top five concerns for business every year since 2014, and the top concern in 2016, 2017, 2018 and 2020.
I have written about this problem since 2015 and it is disheartening to see the impact of shortages on the ground – making worse, an economic environment in which many people are losing their jobs or finding it ever more difficult to find one.
Former Papua New Guiena Prime Minister and Member for Ialibu-Pangia MP, Peter O’Neill has put country's Treasurer Ian Ling-Stuckey on notice after asking for a proper report of COVID-19 funds on the floor of Parliament yesterday.
Mr O’Neill asked the Treasurer to explain the COVID-19 loans that are adding up into billions of Kina.
“Can you assure this House where you are spending this money, so that our people and our country can be aware of the spending the Government is doing to stop the spreading of the COVID-19 in the country.
“Could you give us the exact time frame you will lodge the full report of this loans,” O’Neill asked.
O’Neill said the reason for raising this concern is because the funding are from international organizations that will be repaid by our country and our people.
He also asked the Treasurer to explain the two reports released recently from Moody International Rating Agency that confirms the shortfall of our internal revenue of K2.7 billion which rated our economy from stable to negative.
“Are you aware that the Central Bank has released a Monetary Policy Statement recently which indicates that our economy has declined by two percent by 2020 and continues to project a further decline in 2021.
“What is your Office doing to address the decline of over 5 percent of our economy which is a substantial decline given the state of the economy we are in,” he said.
THE Ihu special economic zone (Isez) in Kikori, Gulf, was launched yesterday among the district’s other impact projects, by Prime Minister James Marape.
He was accompanied by Kikori MP and Foreign Affairs and Trade Minister Soroi Eoe, Works Minister Michael Nali with his department secretary David Wereh, Transport Minister William Samb, Central Governor Robert Agarobe, Gulf Governor Chris Haiveta and Isez officials.
Marape said the K5 million which was part of the K10 million programmed to run every year for the next five years had already been transacted into the Kikori development authority (DDA).
He said that K5 million was to ensure that land registration and the Ihu special papers authority were sorted.
Papua New Guinea PRIME Minister James Marape says the Government hopes to achieve greater benefits for Papua New Guinea through more resource projects.
He said this in Port Moresby on Friday after witnessing the signing of the framework agreement with Barrick to reopen the Porgera Mine in Enga.
PNG stakeholders (Kumul Minerals Holdings Ltd, Enga government and landowners) own 51 per cent of the mine.
“This announcement is a significant milestone in the Government’s effort to build strong frameworks in the resource sector which will benchmark future considerations for similar projects nationwide.
“In the old structure, State parties only had five per cent through Mineral Resources Enga (2.5 per cent Enga government and 2.5 per cent SML Landowners), while 95 per cent was held between Barrick Niugini Ltd (47.5 per cent and 47.5 per cent Zijin).
THE country’s economy is expected to recover this year with growth forecasted for both the mineral and non-mineral sectors, according to the Bank of Papua New Guinea.
However, concerns remain given the heightened risk of the Covid-19 pandemic with the rising numbers of infections as well as the impact of any further tightening containment measures.
According to the Central Bank’s monetary policy statement released yesterday, a rollout of vaccinations would assist with the economic recovery process.
Governor Loi Bakani said the global economy contracted by 3.5 per cent last year according to the International Monetary Fund (IMF) world economic outlook update published in January.“
This Government has been in office come May 2021 will be 2 years (24 months).
This Government must be reminded that the 10 million people of PNG are cared for by our local economy. When economy thrives, everyone is happy. When economy goes bad, everyone suffers.
Papua New Guinea Economy Watch
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