Growth of building sector to slow

 THE growth of the construction sector next year is projected to be a negative 6.4%, Prime Minister Peter O’Neill said.

Speaking during the PNG Chamber of Mines and Petroleum seminar in Port Moresby on Tuesday, O’Neill said this year’s growth in the sector would be 11.9%. 

He said this while explaining the 2014 national budget that was handed down last month. 

O’Neill said the budget was described as a deficit budget.

However, that was what PNG needed at present.

“And that is what we can secure our medium to long-term future in a way that is fair and widely shared. 

“The petroleum and gas sector is effectively “underwriting” the deficit – and the moderate rise in state debt that entails”. 

He said the export of LNG within a year from now will mean that 2015 gross domestic product (GDP) will probably be the highest in the region, if not the world – well over 20%. 

“That will begin substantial royalty and other income flows to the government – and benefit for landowners. And the state will over the medium term also benefit from the dividends,” O’Neill said. 

“The certainty of that enables us to have a modest deficit next year – and to meet the realities of today and tomorrow,” he added. 

“Construction sector has begun to slow from very high levels. 

“The construction phase of the LNG project is heading towards completion, and that is having an impact and is going to have a bigger impact in 2014.” 

However, O’Neill said the view of the LNG project was that the project would have a bigger and positive impact on the lives of Papua New Guineans. 

He said the focus on the development of the LNG was to transform PNG and deliver the maximum benefits for PNG and the seven and a half million people in the years ahead.

“The gas era does offer a “once in a lifetime” opportunity to transform the PNG economy and lives of our people. 

“And I do not just mean economic benefits. It must deliver significantly, widely shared, social and community benefits,” O’Neill said.