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Economy outlook for PNG is very positive, says Deputy PM

The fundamentals of the economy are sound and the future is bright, Papua New Guinea deputy Prime Minister and Treasury Minister Charles Abel said.

He said this yesterday when acknowledging international rating agency, Moody’s downgrade of Papua New Guinea’s ratings from the positive B down to negative.

Abel said Moodys rating was from the outlook side which they reviewed from stable to negative.

“We acknowledge and accept what they are saying but it’s a little bit unfortunate on the back of the situation where we had a massive earthquake which is going to affect us socially and financially,” he said.

“But the main thing that I express my disappointment in is that people should understand the measures the Government is trying to take and some of the positive things that are happening.

“If they could see the outcome of the 2017 Supplementary Budget, the measures that have stemmed from the 100-day 25-point plan that we are doing and there has been a visible turnaround in government financial revenue and off course the measures that we continue to undertake in relation to debt restructuring, addressing foreign exchange, that we have a medium term revenue strategy that has been endorsed by the World Bank and IMF that we are executing.

“The changes we made around the fishing industry, the reviews that we are doing in the upcoming new projects and the new fiscal regime, the fact that there are significant and large resource projects on the horizon coming up in relation to the expansion of the PNG LNG, the Papua Gas and we have Wafi Golpu and Frieda River, these are projects that are going to happen.”

Abel said that with improvement in the oil price which is heading up to US$70 a barrel and the fact that despite the earthquake production is starting on the resource projects again.

“There is a lot of positivity, the other comment I make is that sometimes they pick on foreign exchange issue, I have been talking with the Central Bank Governor on some of the activities we are doing in conjunction with the Central Bank on the foreign exchange problem.

“I always say to the international agencies including the IMF that the fundamentals of PNG are sound and in particular the fact that we have this large current account surplus. If you look at the monetary policy that was published by your paper you can see that the current account surplus is in order of K18 billion-K20 billion (US$5.5 billion – US$6.2 billion for 2017.

“All we need to do is enforce the regulations, collect our taxes, and a lot of the issues that we keep talking about will no longer be there, so they can talk about outlook being negative but to me the outlook for PNG is very positive,” he said.


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