Economy yet to taste gas money

 By GYNNIE KERO

THE revenue from the PNG LNG project is yet to start flowing into the country, according to Bank of Papua New Guinea Governor Loi Bakani.

Responding to questions from The National on LNG receipts, Bakani said the revenue from the shipments made so far would start flowing into the country later.

PNG LNG project operator ExxonMobil PNG Ltd said it had shipped 22 LNG cargo to Japan as of Monday.

Bakani said the country’s Sovereign Wealth Fund would be created next year.

“Revenue from the exports of LNG not received yet. The SWF (sovereign wealth fund) is not established yet (awaiting) the Organic Law and subsidiary laws on SWF to be approved by Parliament,” he said.

He said the Organic Law on SWF should be presented to Parliament in this month’s session.

“The SWF should be created in 2015,” he said.

National Research Institute director Dr Thomas Webster had earlier said the SWF should be crafted in a way that it benefitted the mass Papua New Guineans, thus improving the economy.

Bank of PNG research department manager Dr Gae Kauzi had earlier clarified the announcement by Finance Minister James Marape in June that both the savings and stabilisation funds would get 25% of all LNG and mineral revenues under the new SWF structure.

Kauzi said: “Only the dividends will flow into the stabilisation fund – and only 50%. Taxes will not go into stabilisation fund.

“Fifty percent of that dividend will go into the future’s fund which will replace the development fund under the old model.”

Kauzi said the country needed an efficient and effective budget management so that most citizens could  benefit from the LNG project.

“The answer lies in effective and efficient budget management. And that’s where SWF will try to address instead of all funds being pumped into the budget for spending. Let it be managed through SWF so that it’s spent wisely on projects.”