Banks to fix falling kina

Main Stories, National

The National, Tuesday October 22nd, 2013

 THE Bank of Papua New Guinea and commercial banks are taking steps to arrest the weakening value of the kina and have managed to stabilise it, Governor Loi Bakani says.

He gave the assurance to dispel fears that the value of the kina, which had been on the downslide, would continue to weaken and affect the State, businesses and the people.

Public debate on the issue was triggered off last week by  a warning from economist Paul Barker, the Institute of National Affairs director, that the local currency would weaken for at least another eight months.

He said the kina had been weakening against foreign currencies since July and was hurting some industries and people on fixed incomes.

Deputy Opposition Leader Sam Basil has questioned the Government’s financial policies and where it was taking the nation to.

But Bakani told reporters yesterday that the Central Bank and commercial banks had taken measures in the past two weeks to address the issue. 

It has seen the kina stabilise at US$0.4140.

He was joined at the press conference by Treasurer Don Polye, Finance Minister James Marape and acting Treasury Secretary Dairi Vele.

Bakani said it started in September last year as a result of a slowdown in the LNG construction work and falling commodity prices.

Marape said the country was in good hands and not in dire straits as painted by its critics.

Poyle said the country had sufficient foreign reserves to act as a buffer to the falling kina.