K2 billion-plus still outstanding: Bakani

ABOUT K2 billion is owed to superfunds by the state, according to the Bank of Papua New Guinea governor Loi Bakani.
He said that an option to offset the unfunded liability was through superfund investment partnerships in state-owned enterprises and valuable assets under them.
Bakani said that at a panel discussion on wealth creation and the role of superfunds to increase domestic growth during a financial inclusion and innovation summit.
“In Papua New Guinea, the government still owes the funds probably over K2 billion in accumulated debts,” Bakani said.
Again the mystery or the issue now is how the government can look at options on how to pay that back to the superfunds.
“It is an issue where you have people who have retired already and they have not benefited from the income that would have been earned from this K2 billion and, of course, those who are still working are not earning also from that K2 billion outstanding.”
When it comes to investments and especially where SoEs are concerned, plausible options are that the superfund can undertake with the SoEs to lease those properties and those kinds of investments where the superfund can come in and invest in them, he said.
“The SoEs, of course, do own a lot of these properties and assets that are not earning anything at all and they are just sitting there,” Bakani said.
“They need to be involved in some way to earn some income out of it and the superfunds have funds that are sitting there and those options are there for the funds to discuss with the SoEs.
“It comes back to the issue of the unfunded liability of how that is an added benefit if they can  venture into those kinds of investments and at the same time be able to get the government to reduce the outstanding liability debt  and, I think, it may be good way forward.”