|
By VERONICA MANUK
THE Governor of Central Bank has challenged the Government and private
sector to ensure people living in rural areas benefit from the good
microeconomic condition of the country.
Wilson Kamit issued the challenge during the bank’s board meeting last
Wednesday evening at Ralum Country Club in Kokopo.
The meeting also coincided with the official opening of the Currency
Distribution Centre at Bank of South Pacific.
Mr Kamit was accompanied by his two deputies and board members.
He said the economy of the country had been growing with increased
activity and employment as well as improved confidence in market since
2002.
“While there are stable microeconomic conditions, the challenge now for
all of us is to sustain these macroeconomic gains over the medium term
and to translate them to real, tangle benefits for our people – the vast
majority living in remote rural areas,” he said
Mr Kamit said, therefore, it was important that producers and exporters
continue to make use of this window of opportunity of better commodity
prices and stable economic conditions as good times might not continue
in the future.
He said the economic activity continued to improve in the first half of
this year, led by export sector with higher production and prices of
most mineral and non-mineral commodities.
Mr Kamit said employment in the private sector, excluding the mineral
sector, increased by 3.6% in the June quarter, compared to an increase
of 4.1% in the March quarter.
The annual inflation rate continues to trend downward this year to 1.0%
in June from 2.3% last June.
Mr Kamit said that the positive development in the foreign exchange
market continued this year with large inflow, mainly from mineral sector
which had resulted in the appreciation of the kina.
He said the improved inflow of export receipts from the mineral sector
had increased gross foreign exchange reserves to K4,725.6 million at the
end of June, which was sufficient for total and non-mineral import
covered for 7.6 and 10.4 months respectively.
And as of Sept 21, the foreign exchange reserves were K5,474.5 million.
“The National Government’s commitment to the 2007 budgetary framework
resulted in it achieving a budget surplus of K420.6 million in the six
months to June,” he said.
Mr Kamit said that the interest rate continued to trend down with the 28
days but the Central Bank Bill rate had remained around the 4.0% level
while the commercial banks indicator lending rates also trended down to
reach a range between 8.95% and 9.95%.
He said given the high level of liquidity in the banking system and the
Government switching from short to long term debt, the Central Bank had
issued more than K2.0 billion of Central Bank Bills to mop up some of
the excess liquidity in light of its neutral monetary policy stance.
 
|
