The National, Monday October 28th, 2013
I AM concerned about the falling value of the kina because PNG’s economy is import-driven.
Even though I am not an economist, I will try my best to advise the government on what measures can be taken to stabilise the kina as I understand it.
A lot of politicians are saying that the low kina is good for the tourism industry as we are expecting more tourists to take advantage of the falling kina and visit the country.
Yes, I agree with what our leaders are saying.
However, I doubt PNG will see an influx of tourists because the cost of goods and services in the country is very high.
In addition, we have a chronic law and order problem that will discourage tourists from contemplating a visit to Papua New Guinea.
Furthermore, our towns and cities are unappealing: littered with rubbish, no public amenities, and roads filled with potholes.
The next thing our politicians are saying is that the falling kina is good for the PNG’s export industry. The export industry will take advantage of this and export more PNG products to overseas, hence earning more PNG kina by converting the foreign currencies back into PNG kina.
Well I doubt this too because we don’t have a big scale industries.
Our commodities such as copra, palm oil and coffee more or less depend on world prices.
The country does not have the capacity or infrastructure to produce such commodities in very large quantities when demand increases.
So the only option we have now is to dig and pipe more of our natural resources overseas to earn the badly-needed foreign currencies to stabilise the falling kina.