PNG Government Insists New 500M Loan Is Legal

Approved budget provides for up to 1B of offshore financing for deficit and development

WELLINGTON, New Zealand (Radio New Zealand International, July 1, 2016) – Papua New Guinea's government has reportedly secured a loan of US$500 million from the multinational financial services agency Credit Suisse.

The newspaper, The National, reports that the loan will help the government to finance some of the deficit in the 2016 national budget.

The budget, passed by parliament in November 2015, provides for sovereign financing of approximately US$1billion to be provided by offshore investors.

According to the Treasurer Patrick Pruaitch, the new financing would be used to meet expenses such as infrastructure and development projects.

Mr Pruaitch says that all legal and procedural requirements for the loan had been met.

He says any legal challenge to the legality of the new loan will be a waste of time and taxpayers' money.

The Peter O'Neill-led government faced legal action over the way it took out a controversial US$1.2 billion state loan over two years ago.

Radio New Zealand International
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