“We will continue discussing with the World Bank about accessing more of its US$12 billion assistance package. Discussions with the International Monetary Fund are proceeding about accessing US$182m of additional budget support for this year for the coronavirus economic impacts,” he stated.
“These funds will be at zero interest rates to avoid putting extra pressure on our budget. The Asian Development Bank has also announced a new facility of $US6.5 billion as an initial response to the COVID-19 pandemic. At times such as these, the work we have done with our international friends, and the credibility of our economic reform program, means that PNG is now well placed to help secure funds to help deal with the expected shortfalls in revenues and foreign exchange because of the pandemic.
“The revenue impacts from the pandemic are likely to be severe. Already, the dramatic fall in oil prices will feed through into LNG prices.
“Lower resource sector profitability could put at risk most of the expected K1.3 billion in resource revenues budgeted for this year. The additional foreign assistance is unlikely to fill all of that gap. So although we are getting extra assistance, most of that will simply go in filling the tax and foreign exchange gaps created as a result of the global economic downturn.
“There is a need to be very, very careful with our spending – directing it to where it is most needed, cutting back on lower priorities.
“The Ministerial Economic Committee discussions, along with discussions with PNG businesses, will all feed into a targeted economic package for NEC consideration.
“The Committee will continue to monitor the state of the budget and economy over the coming weeks. A Supplementary Budget will likely be required in coming months to address the re-allocation of expenditures to support our health system and economy.
“There is no need to rush this as there are other mechanisms to effectively re-direct funds to priority areas over the next few months (such as warrant controls).We will continue to keep the people of PNG informed on economic and budget developments.
“There’s no easy fix for what lies ahead. Any plans must be flexible to deal with the uncertainties of this pandemic. I want to assure you the Marape-Steven Government will always act in the best interests of our country through being prepared for, and then responding to the coronavirus.
“Over our history we have demonstrated considerable resilience in the face of extreme adversity. This is the collective strength of our people of working together to overcome these challenges.
“I, my other economic Ministerial colleagues, and the rest of the Marape-Steven Government remain confident we will do the same in responding to coronavirus.”