A FOREIGN investor who has plans to spend K1.3 billion building houses in PNG fears the plans may fall through, and has asked Prime Minister Sir Michael Somare to intervene.
Malcolm Dixon, executive chairman of Interholdings Ltd, plans to spend US$460 million over 16 years to build 95,000 houses in the country.
Mr Dixon told Sir Michael in a letter, a copy of which was leaked to the media, that under his housing plan, PNG would become “the Singapore of the Pacific” once the project is completed by 2025.
Housing Minister Andrew Kumbakor has been courting Mr Dixon and his company over the last three months for the project.
If the deal goes through, the PNG Government would repay his money at the interest rate of 5.25%.
But it is understood the Central Bank of PNG has refused to support this project. The reason was not disclosed to The National, but Mr Kumbakor said yesterday the Central Bank had advised him to be “very cautious” on this project.
The National Housing Corporation has not been involved in the project, and managing director Paul Asukusa said yesterday his management and the board had been left out of negotiations and paperwork for this project.
Mr Asukusa said the project did not go through the NHC board and management.
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He said it was done outside the NHC processes, and did not go through CACC.
He said this project would be costly for the State and he would ask the Prime Minister to cancel it.
But Mr Kumbakor last night rejected Mr Asukusa’s assertions, saying correspondences only had been exchanged and no firm proposal had been entered by CACC and other necessary agencies.
“What had happened was that Central Bank had advised us to be cautious on this project, and I’ve conveyed this to Interholding Ltd. They had written to the Prime Minister directly, and I will also be writing to the Prime Minister to advise of the Central Bank’s position,” Mr Kumbakor said.
He said they have followed due process and done due diligence on the company.
“Asukusa is trying to divert attention away from his mess. His failure has caused us to delay the launch of the project for 40 houses in Gerehu. Asukusa is sending wrong signals and I won’t be surprised if investors get worried about coming here. I won’t be surprised if Government departments are refusing to release money for the project because of Asukusa,” the Minister said.
The Prime Minister’s Office could not be reached for comments on the letter sent to Sir Michael by Mr Dixon.
In his letter, he said he once owned Dixon Home in Australia and was now concentrating on a new venture called the Duraframe steel framing system.