IMF Projects Robust Growth In 2016 For PNG

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Pacific Islands Development Program, East-West Center With Support From Center for Pacific Islands Studies, University of Hawai‘i

PM O’Neill appreciates ‘frank assessment’ of economy

PORT MORESBY, Papua New Guinea (PNG Post-Courier, Jan. 7, 2016) – Prime Minister Peter O’Neill has praised the International Monetary Fund for presenting a frank assessment of the economy.

The report had commended the Government for achieving impressive economic growth in recent years.

The IMF projected economic growth for PNG to be robust in 2016, but warns of challenges posed by the sharp drop in commodity prices.

The global financial institution supported the move for PNG to debut the sovereign bond market, urging the government to use the funds raised to improve PNG’s debt profile and fund existing projects and commitments.

Mr O’Neill said this is a frank assessment by the IMF and he welcomed the comments and observations. Their recommendations are largely in line with the measures the Government took to protect the economy and fiscal position when the oil and commodity prices dropped drastically last year.

"The measures we undertook are reflected in the 2015 Supplementary Budget we passed and the 2016 Budget that will guide us this year and beyond," he said.

"This year we hope to make our debut in the issuance of sovereign bond. This will help us raise money in the global market to improve our debt profile, and fund projects around the country that keep Papua New Guineans employed.

"Unfortunately there are people who know very little about the debt market; they continue to make ill-informed statements about the sovereign bond. They try to link it to the 4.2 per cent equity in the LNG Project that is available to the landowners," he said.

The Prime Minister said landowners’ interest and benefits from the LNG project were safe and guaranteed. "It will not be extinguished, sold, or taken away by anyone, as suggested by the Opposition and other so-called experts," he added.

He said landowners have to now raise the funds to pay for the shares on terms they agreed with the National Government under the UBSA. The Government will honour its commitment and also ensure that landowners’ interests are protected, he added.

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