economy

This is due to an increase in global commodity prices and production in the domestic mining industry, coupled with improved performance in the non-extractive sector.

“PNG’s economy grew by an estimated 2.2 percent in 2017, according to the 2018 budget tabled in Parliament on November 28,” reports the Group.

“While above the 2 percent annual growth rate recorded in 2016, the figure was below the 2.7 percent expansion forecast in the Treasury’s Mid-Year Economic and Fiscal Outlook, released at the end of June. 

Westpac director and senior economist, Justin Smirk, said while there were positives to the introduction of the trading ban on the Kina, there were also implications.

Smirk said the current situation constrains local business expansion and creates a tightening in the Kina market.

Smirk said the decision to peg the kina in July 2014 ensured currency stability, prevented mass depreciation and created certainty in the Kina.

Westpac senior economist and director, Justin Smirk, said this during the Port Moresby Chamber of Commerce and Industry Business Breakfast in Port Moresby today.

Smirk said as global commodity prices remain stagnant and commodity currencies weakening, the likely effect would be the same for PNG.

He said PNG should now shift its focus to the essential areas of revenue generation and growth.

“Focus on what’s important to you and what you can do,” he told the business community.

They warned that lack of access to foreign exchange had become the “No 1 issue for business” and if prolonged, could cause PNG to face another “lost decade” of economic growth, similar to what happened in the 1990s.

The four economists presenting at the Development Policy Centre at the Australian National University forum include Prof Stephen Howes, Director Development Policy Centre, Australian National University; Nelson Nama, School of Business and Public Policy, UPNG Rohan Fox, Research Officer, Development Policy Centre, ANU and Marcel Schroder.

When officially opening the 10th Parliament session today, the Sir Bob Dadae said these include relevant amendments to legislation in sectors such as agriculture, fisheries, forestry and tourism.

He said the Government must also enable more national or landowner participation.

“There must be necessary reforms aimed at creating inclusivity and a level playing field that provides a conducive environment for small and medium-sized businesses to be established, operate and grow the economy.”

The EIU, which is the research and analysis division of The Economist Group, indicates that conditions in 2017 are likely to be more favorable for PNG than in 2016 when the economy was hard hit by weak global commodity prices, which weighed on fiscal and export revenue.

In 2018, The EIU expects a slowdown in the rate of expansion, as these positive factors wane and weaken global growth, resulting from a sharp slowdown in China, weigh on export revenue and investor confidence.

As vote counts trickled in from five state elections on Saturday, one result loomed large: that of central India's Uttar Pradesh, home to more than 200 million people. The staggered five-week vote in that state alone marks the biggest election in the world in 2017.

Modi's ruling Bharatiya Janata Party, or the BJP, looks poised to take about 75% of the 403 seats on offer in Uttar Pradesh.

During the officially opening of the two days Summit this morning, O’Neill confidently said the country’s economy is doing well.

He said PNG had faced challenges in the past years due to the drop in commodity prices.

However, he said the decrease in commodity prices did not change the main goals of the government to provide free education and health care to the people.

“With a very careful management of our economy, we did not lose grip of it and we never cut essential services to our people,” O’Neill said.

Opposition Leader Don Polye said this following a suspension of Papua New Guinea’s voting right in the UNO, due to non-payment of its membership fee of US$180,000 (K571,000).

Polye claimed the suspension culminated with the country’s overseas missions being at the brink of closure associated with the same.

“The government pays more than K300 million as membership fees to similar other international organisations. I will not be surprised to see them facing the same issue in the months ahead,” Polye said.

Because of the high growth rate previously, and with the commencement of the LNG project in 2014, expectations were high, leading to a number of hasty borrowing decisions by the Government.

National Research InstituteI’s Senior Research Fellow and Economic Policy program leader, Dr Francis Odhuno, said borrowing itself was not bad, as long as you know you’re going to repay your loan on time and the investments you make on the borrowed money, yield high returns. However, with unforseen shortages comes the temptation to borrow more.