By MALUM NALU
PNG Sustainable Development Programme (PNGSDP) chairman Sir Mekere Morauta says the US$1.3 billion (K3.9 billion) long-term fund is intact and safe from “octopuses with fingers everywhere”.
He said in kina terms, the fund increased from K3.4 billion to K3.9 billion.
Mekere said this at the PNGSDP annual results meeting in Port Moresby yesterday which, unlike past gatherings, was a small and subdued get-together of about 25 people mainly from Western.
“I want to assure you all that the long-term fund – US$1.3 billion – is completely safe,” Sir Mekere said.
“No one can touch it.”
He said while dividend flows were terminated after the expropriation of the Ok Tedi mine by the State in 2013, “the board is working very hard to ensure that the funds are invested more profitably than before so that this money, when we start spending, will continue to grow for a very long time in Western province, long after the mine closes.
“When the mine closes, SDP will be there spending this money for 40 or 50 years,” Sir Mekere said.
“Our responsibility is to protect that money – protect it from octopuses – from people with fingers everywhere.
“I want to assure the people of Western province and Papua New Guinea that the long-term fund is safe and is well managed.
“The board and the management will continue to invest that money to earn more interest than before.”
Sir Mekere said PNGSDP still had a number of assets in PNG which were at risk, and the board was trying to monetise them by selling what it could.
He also said:
- PNG assets during the year were subject to deteriorating domestic market conditions, including a decline in the value of the kina caused by waste and economic mismanagement. As a result, PNG assets contributed a foreign exchange loss of $US13.5 million in 2015. The forex loss contributed to an overall reduction in net investment income from $US16.1 million in 2014 to $US4.6 million;
- PNGSDP increased its cost-cutting efforts during the year through a new cost management sub-committee, achieving a 48 per cent reduction in expenses from $US20.5 million in 2014 to $US10.7 million in 2015. Administrative costs were reduced by 63 per cent from $US14.2 million in 2014 to $US5.3 million. Governance costs declined owing to a renegotiation of audit fees and targeted reduction in directors’ travel and board-related costs. The board also elected not to increase directors’ fees since taking a 10 per cent reduction in 2013; and court action against the expropriation was continuing in PNG and Singapore.