PNG CREDIT RATING REMAINES STABLE DESPITE FALLING GAS PRICES
International rating agency Standard and Poor's has maintained PNG's long-term credit rating of B plus, despite fears of the impact of falling gas prices on the PNG economy.
According to Craig Michaels, a Standard and Poor's analyst, PNG's economy is reliant on the resources sector, but is showing resilience in the face of low gas and oil prices. He believes that although some of PNG's economic indicators have weakened - including the increasing government debt - overall the economy is showing resilience.
One area of concern identified by Standard and Poor's was the prospect of a falling Kina. If the exchange rate value of the Kina falls, then the payments the government has to make on foreign debt will increase. Government debt is currently 5% of GDP, which is quite high. Standard and Poor's expect this to shrink as LNG sales increase over the medium term.
One key point raised by Standard and Poor's was the importance of keeping debt under control. The current 2015 PNG Budget includes some marked increases in government spending. If short-term government revenues are less than expected due to low gas and oil prices, then the government will need to reduce spending, or risk growing debt and a downgraded credit rating.
Overall, Standard and Poor's believe that the medium and longer term outlook for the PNG economy is positive. Commodity prices are currently low, but are expected to recover, and total exports - of oil, gas, timber and agricultural commodities - are expected to increase.
UNITED NATIONS PRAISES PNG'S RECENT ECONOMIC DEVELOPMENT
A recent report published by the United Nations Development Programme (UNDP) - Achieving Development Results in Asia and the Pacific - states that PNG's recent economic growth has transformed the country into a lower middle-income economy.
The report points out that infrastructure has been improved in some areas of the country, and that there is a growing focus on sound evidence and statistics to guide policy decisions. Also highlighted were the government's ongoing efforts to combat corruption, and the leadership role that PNG is assuming in the Pacific Region.
Challenges remain - including high rates of poverty, infrastructure challenges, incomplete health coverage and a lack of access to education in some parts of the country - however the report indicates that PNG is making solid progress towards its goal of becoming a middle-income country.
PRIME MINISTER PETER O'NEILL DECLARES THAT PNG IS OPEN FOR BUSINESS
During a recent event hosted by the Australia PNG Business Council in Sydney, Prime Minister Peter O'Neill highlighted government plans to boost non-resources industries in PNG.
The PM singled out the agricultural sector - including palm oil, coffee and rubber - as well as tourism as areas providing opportunities for investment and economic development. Mr. O'Neill emphasized that public private partnerships in these industries will provide substantial opportunities for investment from the private sector.
Mr. O'Neill told the attendees that the government of PNG is pro-business, and is partnering with businesses in many sectors in order to promote employment for Papua New Guineans.
AUSTRALIA AND PNG AIM TO STRENGTHEN NETWORK TIES
During a recent trip to PNG, Australia's Minister for Foreign Affairs, Julie Bishop, announced the details of further support for the Australia-PNG Network. The initiative, which was agreed to at the Australia-PNG Ministerial Forum last December, is a key element of the plans to strengthen both economic and social ties between the two countries.
The Australian Government will provide AUD 1 million over three years for the initiative, which will be hosted by Australia's Lowy Institute and various PNG partner organizations. These organizations will have strong links across business, civil society and academia in both Australia and Papua New Guinea, whilst the Network itself will include an interactive online hub to share knowledge and experience, as well as foster new partnerships.
CHINESE AMBASSADOR HIGHLIGHTS STRONG TRADE RELATIONSHIP WITH PNG
The Ambassador of the People's Republic of China to PNG, Qiu Bohua, has assured the people of PNG that a new bilateral agreement to purchase LNG products is an example of the enormous trade potential between the two countries. From this year, China will begin buying two million tons of LNG products annually, for the next 20 years.
The outgoing Chinese Ambassador also noted that China has invested about US$2 billion into Papua New Guinea so far. "We attach great importance to our bilateral cooperation," he said. "In the last four years China's cooperation with PNG really developed very fast [and] smoothly to be the largest investment in the Pacific Islands region… …I am very confident about the future of PNG," he added.
WEAKENING PNG KINA COULD HELP LOCAL BUSINESS SAYS WORLD BANK
World Bank country economist Tim Bulman has said that further depreciation of the PNG Kina will benefit local cash crop farmers, workers and businesses by strengthening their competitive position. The Bank of Papua New Guinea (BPNG) recently revealed in its September 2013 Quarterly Economic Bulletin (QEB) that the Kina has depreciated against most major currencies.
Bulman argued that further weakening of the currency would "reduce the costs of operating in PNG compared with other countries, which could help make it worthwhile for PNG and international investors to develop businesses and create jobs here". He further noted that a continuously weakening Kina would also support government revenues and royalty payments.
PNG UNVEILS NEW RUGBY LEAGUE TEAM: THE PNG HUNTERS
PNG Rugby Football League has announced that a new team to compete in the Queensland Cup will be named the PNG Hunters. The team will be based at the Kalabond Oval in Kokopo for at least the next two seasons whilst Lloyd Robson Oval in Port Moresby undergoes a major upgrade.
The PNG Hunters will play their first match against Redcliffe in March. The game will be televised on Channel Nine and is sure to generate a high level of interest, both from footy fans and other Intrust Super Cup clubs eager to get a read on how the newcomers will fare in their first season. It will also mark the start of a significant new chapter in PNG rugby league history.
O'NEILL: PNG LIVING STANDARDS SET TO IMPROVE
In his recent Christmas address, PNG Prime Minister Peter O'Neill has said that the people of PNG can expect an improvement in living standards and greater opportunities in 2014. Mr. O'Neill said "with total confidence" that living standards will improve as a result of the government's effort to "bring about the decentralization of the delivery of basic services such as school education, health centers, and building and repairing rural roads".
The Prime Minister also said that the PNG economy is sound and well placed for future growth. He thus encouraged more people to participate in the economy through small and medium enterprises, pointing out that the 2014 budget will provide funding for a range of initiatives; including access to affordable finance.
PNG SET FOR 2014 ECONOMIC WINDFALL AS LNG PROJECT COMES ONLINE
PNG is preparing itself for a massive economic windfall as the first Liquefied Natural Gas (LNG) deliveries from the Exxon-Mobil led project are due to come online in the second part of 2014.
Upon completion, the $19 billion (AUD) LNG project is expected to treble PNG's total exports and push the national economic growth rate to above 20 per cent - potentially making the small Pacific island nation the fastest growing economy in the world.
ExxonMobil's PNG LNG project executive, Decie Autin, has said that the revenues derived from the project will provide a long-term financial foundation for continuing economic development in PNG. She also noted that the project's success could potentially "herald a new era of development for this diverse and strategically located nation".
RAINTREE HOTEL AND SUITES
On Friday March 8th 2013, a large crowd celebrated the Ground-Breaking Ceremony for the Raintree Hotel and Suites by Vision City. The ceremony was presided over by national and international dignitaries, including PNG Prime Minister, the Hon. Peter O'Neill, Rimbunan Hijau Chairman Tan Sri Datuk Sir Tiong Hiew King, Malaysian High Commissioner Datin Seri Blanche Olbery and representatives of other international diplomatic missions. . . more
RH (PNG) CELEBRATES 20th ANNIVERSARY IN STYLE
The Rimbunan Hijau (PNG) Group has celebrated its 20th anniversary in Papua New Guinea in style with a gala evening attended by the former Acting Prime Minister, Samuel Abal, various Cabinet Ministers and Members of Parliament, company officials and local business leaders.
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RIMBUNAN HIJAU presents 2nd Annual donation to BAHA