PNG CURRENCY STILL FALLING

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PORT MORESBY, Papua New Guinea (May 13, 1999 – Radio Australia)---The rapid fall of the Papua New Guinea currency, the kina, has sparked warnings of serious economic consequences.

The kina has dropped to record lows, hovering around 60 Australian cents and 39 cents U.S.

Oil companies have warned that they need a price increase to offset the effect of the falling currency, and may scale down operations in PNG if there are no changes.

The PNG Chamber of Commerce reports the cost of living in cities and the cost of doing business are expected to rise considerably.

However, there is a view in the business community that a lower kina will help generate more sustainable and realistic development by forcing a reduced reliance on imported products.

Some business people believe the kina has been at artificially high levels for too long, and that the lower kina will force a new approach to economic management.

For additional reports from Radio Australia, go to PACIFIC ISLANDS REPORT News/Information Links: Radio/TV News/Radio Australia.

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