Former PM Claims Political Interference in PNG Central Bank, Risking Financial Stability

Morauta claims government using bank to prop up cash position, cover up mismanagement

WELLINGTON, New Zealand (Radio New Zealand International, June 21, 2016) – A former prime minister of Papua New Guinea claims political interference in the Bank of PNG is threatening the stability of the nation's financial system.

Sir Mekere Morauta said this is increasing risks for bank depositors and investors in PNG financial institutions.

He said the central bank is supposed to be the independent watchdog that supervises the system and ensures risks are kept to a minimum.

But Sir Mekere said the Peter O'Neill government is increasingly using the BPNG as a tool to prop up its shaky cash position and to defend its mismanagement of the economy.

Sir Mekere said this means the central bank is failing in its duty to oversee the financial system effectively and transparently.

He said it is yet another example of the destruction of systems and processes by the O'Neill government to protect its own interests.

Sir Mekere said the Bank's own figures show the government's domestic borrowings are more than double what they were four years ago, but this is a danger sign the Bank has chosen to ignore.

Radio New Zealand International
Copyright © 2016 RNZI. All Rights Reserved

Rate this article: 
Average: 4 (1 vote)

Add new comment