Treasurer Ian Ling Stuckey has clarified that the K1.2 billion loan from the International Monetary Fund comes with not conditions attached.
Ling-Stuckey clarified this again, for the member for North Waghi Fabian Pok.
Treasurer Ian Ling-Stucky, who was questioned on this by the member for Ialibu-Pangia on Tuesday, repeated that the loan was interest free with no conditions attached.
“There are no conditions attached to the IMF loan,” says the Treasurer.
However, the former Prime Minister and Ialibu Pangia MP Peter O’Neill remained unconvinced.
“There are two conditions that are normally given by the IMF to member countries that are seeking this.
“One is quantitive, and the other is structural conditions.”
The Government had secured a K1.2 billion soft loan following an IMF board vote last Friday 5th June 2020.
Prime Minister James Marape said it was a sign of confidence in the PNG economy from the IMF.
The Prime Minister said the Treasurer has stopped expensive commercial borrowings and instead delivered a major reform agenda that has reshaped PNG’s debt management strategy to focus on securing good, cheap, transparent financing from the international community.
The K1.2 billion lending program was secured on unprecedented terms of 0.0% interest rate over 10 years with a 5.5 year grace period and the first principal repayments to start in December 2025.
He said the loan will go straight into the Bank of Papua New Guinea with direct foreign exchange benefits for the private sector.
The Prime Minister said the loan forms the core of the 2020 budget and is within the five-year fiscal consolidation strategy, to bring debt-to-GDP ratio to below 40 per cent in 2024, and restore commitment to the limits set out in the Fiscal Responsibility Act.