K1.9bil forex fund ‘good news’

By SHIRLEY MAULUDU
THE Business Council of Papua New Guinea (BCPNG) has welcomed the announcement by Prime Minister Peter O’Neill last week to bring in K1.9 billion to ease the foreign exchange issue in the country i
However, BCPNG executive director Douveri Henao suggested the Government consider a sustainable approach to dealing with forex matters in the future and not rely on “borrowing”.
“It’s a welcome news, it’s positive news,” he said.
“The backlog in foreign currency payments has always been a major challenge on sales performance.
“However, we do encourage the Government to find a more sustainable solution.
“Obviously, borrowing can help us in the short-term and medium-term, but we really need a more-sustainable approach.
“We look forward to having those currency subscriptions in the market.
“We certainly encourage the Government to urgently finalise the budget support with the development partners and bilateral partners.”
Henao said the private sector would encourage the Government to continue pursuing the foreign direct investment agenda.
He said getting critical projects up and running would provide a market-oriented supply of foreign currency which in itself would be “more-sustainable”.
“We are really pushing the diversification agenda,” Henao said.
“Foreign investment should not only target the oil and gas sector and minerals. Having other sectors with emphasis on agriculture, manufacturing and services will enable a healthy supply of foreign currency in the market.
“In the medium to long-term, we recognise that this (forex support) is a short-term fix.
“In the medium to long-term, firing up the foreign investment is a critical part of the journey.”