PAPUA NEW GUIINEA COURTS ASIAN ECONOMIC HELP

By Yehiura Hriehwazi

PORT MORESBY, Papua New Guinea (The National, Sept. 3) – The Papua New Guinea government is "courting" Asian economic powers to help salvage the PNG economy in the event that the Western world, including Australia, cut assistance.

The Prime Minister, Sir Michael Somare and his Cabinet are fully aware that the country is technically broke.

PNG is having difficulty paying its bills; it owes K150 million in interest on Treasury Bills. That's on top of domestic loans running at K337 million.

While it claims that its budgeted 2003 revenue is on target, the country is not spending as much as it says it should, especially in its development budget.

More serious is the fact that it's struggling to meet its day-to-day bills in utilities, rentals, office stationery, repair and maintenance of equipment. Some fear that salaries could be next.

A week ago, a government delegation left for Malaysia to arrange a financial rescue package on "commercial terms" for PNG. 

The government is also talking to China and Japan to seek their help to develop and commercialize the vast natural gas resource in the Papuan Basin.

Petroleum Minister Sir Moi Avei is said to have had fruitful discussions with Petronas of Malaysia. Taiwan is also said to be keen to have a look at PNG gas resources.

While China has signed up a 25-year deal to buy gas from Australia, sources say there is room for more gas from China.

The only foreign diplomat that attended the 12-Months-in-Office celebration of the Somare-Marat government on Saturday was the Chinese Ambassador Mr Li Zhengjun, whose presence was well acknowledged by the 400-plus crowd at the Grand Palace Restaurant.

One of the highest-ranking executives of the Chinese Communist Party, Liu Yungshan, is leading a 15-member delegation to PNG, arriving about midday on September 16, to celebrate the 28th Independence anniversary with the people of PNG.

September 3, 2003

The National: www.thenational.com.pg/

 

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