Foreign Exchange

In a recent press release, Mr Lelang called for a recall of Parliament to address the issue urgently.

Lelang said, “The fuel shortage is only symptom of another problem. Soon it will be shortages of imported food and other essential inputs for the smooth operation of business and commerce in the country.”

According to the 2022 BSP Quarter 4 Pacific Economic and Market Insights Report, foreign exchange (FX) market turnover for 2022 increased by 17.3 percent compared to the prior year.

BSP Group General Manager for Treasury Rohan George said, “FX turnover in 2022 was supported by strong commodity prices, in particular Oil, Copper, Palm Oil, and Coffee. These firmer commodity prices assisted to offset the lost FX inflows from the closure of the Porgera gold mine.”

Prime Minister Marape in a statement said the case of Puma being unable to maintain the supply of fuel products to its customers was because of ongoing issues with Bank of PNG (Central Bank), for which the country was being held to ransom.

PM Marape has asked BPNG, immediately after an urgent National Security Advisory Committee today (January 5, 2023), to find a short-term solution by lifting restrictions on Puma so that their supply of fuel products continue without compromising Central Bank’s fiduciary requirements.

“Without compromising Central Bank’s role in ensuring that transactions are legitimate and proper, I appeal to it to exercise wisdom and not just be a policeman, but use monetary policy and the Bank as an incubator of economic activity in PNG.

“The Government is also looking at the arrangement with Puma, whereby they have a monopoly in PNG, and does not want the country to be placed in a dangerous security situation.

“I ask the Central Bank to clear the order for the supply of fuel products by Puma to continue, in the meantime, as we find permanent solutions.”

This restriction was effective as of Wednesday 4^th January, 2023; and affects Air Niugini and all other airlines operating throughout Papua New Guinea.

However, the Oxford Business Group says it may be some time before the imbalance is fully rectified.

On March 31 Loi Bakani, governor of the Bank of PNG, issued the reserve’s latest monetary policy statement, with one of the performance highlights showing a strong improvement in the economy’s foreign currency position.

The UPNG and Australian National University academics reported that the Government’s response to PNG’s urgent economic crisis was to focus on fiscal correction and now, tariff protection, which is not sufficient.

According to the 2018 PNG economic survey, a limitation to fiscal correction is that it fails to provide any stimulus to exporters and is inadequate to tackle the primary problem facing the PNG economy, namely, the shortage of foreign exchange.

Director-General of the APEC PNG 2018 coordination authority, Sir Charles Lepani, said this during the recent Business Advantage Papua New Guinea Investment Summit in Sydney, Australia.

Sir Charles said the lead up activities should see income streams flowing into the country and will benefit not only established companies but small businesses and the informal sector.

According to Business Advantage PNG, Sir Charles shared an overview of some of the benefits for both major businesses and smaller establishments.

Steamships Trading Company Limited in a statement to Port Moresby Stock Exchange notified that the interim dividend payment of 2016 will not be effected on Sept 30, 2016 for non-PNG shareholders due to the mentioned reasons.

Currently due to Bank of Papua New Guinea exchange controls there is a large back log of currency purchase orders

However, it is anticipated that payment will be effected by Oct 10, 2016 on current conversion availability.

Govt may not achieve LNG targets: Bakani warns

​The Government’s price forecast of US$60 (K170) per barrel for oil and US$12 (K34) per million metric British thermal units (mmbtu) for LNG may not be achieved, Central Bank Governor Loi Bakani has warned.

http://www.looppng.com/content/govt-may-not-achieve-lng-targets-bakani-warns

Oro takes tough action on illegal traders