Opposition welcomes World Bank report on economy

The National Business

THE Opposition welcomes the latest World Bank report on the Papua New Guine economy released last week, says Shadow Minister for Treasury and Finance Ian Ling-Stuckey
“There is much wisdom in the report, especially in terms of stimulating private sector development through competition, rather than backing Government ‘besties’ and cronies, as well as a good focus on getting agriculture growing again.
“The report includes bad news for the O’Neill/Abel Government.
“Behind some diplomatic words are some very critical details and numbers.” Ling-Stuckey said the report confirmed:

  • In international terms, the PNG economy was going backwards and was actually smaller now than it was four years ago ($US22.3 billion in 2018 vs $US23.1 billion in 2014);
  • in Kina terms, PNG’s GDP in 2018 was K73 billion (the $US22.3 billion figure in 2018 converted at the average exchange rate in 2018 of 0.304), more than 10 per cent lower than the Government’s estimates of K82 billion – “the master chefs are still lying about the size of the economic cake”;
  • there was a serious recession in the non-resource sector in 2015;
  • the O’Neill/Abel government was in breach of the 35 per cent gross debt to GDP legislative limit;
  • public debt was currently understated as it did not include debt guarantees for State-owned enterprises as well as debt arrears;
  • the medium-term revenue strategy was failing;
  • the medium-term development plan was not funded;
  • the government had blown its budget deficit targets in both 2018 and 2019 due to weak spending controls;
  • hidden expenditure arrears had reached K948.1 million by Oct 2018; and,
  • PNG’s risk of debt distress is confirmed as ‘moderate’ (up from ‘low’ before Charles Abel became Treasurer.