PNG needs to start big projects: Bank

By SHIRLEY MAULUDU
THE implementation of the new multi-billion kina resource projects such as the Papua LNG and Wafi-Golpu will positively impact the country’s external balance of payments, according to the World Bank.
It also said foreign exchange inflows in the form of foreign direct investment and external borrowing would be used to import goods and services required for these projects – resulting in narrowing the current account surplus.
PNG country office senior country economist Ilyas Sarsenov said the implementation timing of these projects was still uncertain.
“So, near-term impacts are unlikely,” he said.
Prime Minister James Marape and economist Paul Barker had recently said the economy would receive a huge boost if the two projects start soon.
Marape said it was what the economy would need to help its recovery after the impact of the Covid-19.
The bank also said a significant share of foreign exchange inflows would be used to buy domestic goods and services, thus keeping foreign exchange in the economy.

“The latter should help the Central Bank replenish international reserves, as the current pressure on the exchange rate is expected to ease and reverse,” the bank said.
In its recent macro poverty outlook, the World Bank noted that PNG continued to face economic headwinds resulting from global and domestic economic uncertainties.
“PNG’s growth outlook was being affected negatively by the coronavirus spread, the exacerbation of the LNG glut, and delays in delivering new resource projects in PNG,” it said.
“A limited fiscal space and a rigid exchange rate regime constitute constraints for the authorities to react to these shocks, requiring an urgent mobilisation of external financial support from the development partners.”
The Government is expecting a significant revenue shortfall in the resource sector as export revenue will be lower.

Businesses need some breathing space: Fiocco

BIG and small businesses are feeling the strain of the state of emergency restrictions, and are hoping that some will be lifted soon to inject life back into the economy, a spokesman says.
Port Moresby Chamber of Commerce and Industry president Rio Fiocco told Business Advantage PNG that “our goal is to keep the city’s businesses operating and keep things working as much as normal”.
He said one obstacle was the restriction on the movement of people.
“A lot of businesses are really on their knees,” he said.
“Almost daily I am told of a restaurant or a small business that has closed its doors. And of course everyone that closes their doors loses their employees. That has an ongoing impact on their families.
“Our priority is to keep operating, to keep the doors open and keep as many employees working as we can.
“Our goal is to keep the city’s businesses operating and keep things working as much as normal (when the movement of people are being restricted).
“Foot traffic is down, there is confusion about the rules of moving goods between provinces, and the Covid-19 cases are growing.”
He said the worst hit were the small-to-medium enterprises who “simply do not have the capital to ride out a sustained loss of turnover”.
“When you analyse it, you will see that there is very little that the Government is offering because it has very little money to offer,” Fiocco said.
“We need relief to businesses from some of the taxes like land tax and a reduction in some of the tariffs for electricity and even water. We would like to see some sort of assistance package even it is a waiver of some of the salary and wages taxes or tariffs, even if it is just for this year or the last three-quarters of the year.”

Institution waiting for Manning’s approval

By SAMUEL BARIASI
HIGHER education institutions are waiting for the green light from the State of Emergency Controller David Manning to resume classes next Monday, an official says.
Fr Jan Czuba, the secretary to the Department of Higher Education, Research, Science and Technology, called on Manning to allow all tertiary institutions to resume classes.
“What we have to do is to learn how to live with this virus and protect ourselves from it while waiting for a vaccine to be developed,” he said.
“The full art of life is to accept the fact that the virus has arrived and that we have the intellectual competency and capacity to adapt.”
He said studies using “math models and analysis of an influenza pandemic” proved that the closure of education institutions “does not stop the spread of the virus”.
He has written twice to Prime Minister James Marape and Manning requesting that classes resume. They are yet to reply.
“Are we going to succumb to our fears and rash decisions based on things happening outside our control today?” he said.
“I think the closure of higher education institutions is not an option for us in PNG. Once you disturb a year of academic activities especially in universities, it will take four years to recover. Our universities know that very well.”
Czuba said the public and private sectors would suffer in terms of human resources.
“These sectors will be looking for employees next year but that will not happen because people will not graduate,” he added.

Teachers worried about enforcing social distancing in classrooms

TWO teachers at the June Valley Primary School in Port Moresby are concerned about how social distancing and sanitisation will be enforced when schools resume on Monday.
Grade Four teacher Lilly Hauke told The National yesterday that social distancing would be hard to enforce because most schools were overcrowded and the teacher-student ratio was too high.
She called on the Government to build more and bigger classrooms to ensure social distancing could be managed.
She said schools would also need funding to provide hand sanitisers for students and teachers.
“We will need funding to ensure that safe and strict control measures are maintained in schools,” she said
Schools will need to have temperature checks and hand sanitisers for students and teachers.
Grade Two teacher Ruga Kiri said the health of students and teachers would be put at risk if schools resumed.
“It will be hard to maintain social distancing because children love to play and mingle with each other,” he said.
He said if one student contracted the virus, all students were at risk of contracting it.
“All it takes is for one student to contract it, and I fear for them because they’re vulnerable,” Kiri said.

Marape wants return to normalcy as soon as possible

PRIME Minister James Marape wants normalcy restored “at the earliest”, as the country continues to deal with the Covid-19 threat.
“I am getting our health experts to finalise protocols on living with (Covid-19) in our schools, our workplaces, our churches and communities,” he said.
“I want specific protocols be tailored to ensure that the state of emergency period is used to acclimatise people with Covid-19 protocols beyond June 2 when (the emergency) expires.”
Marape appealed for peace and calm “as we support each other through this tough time”.
The Government will also work with the two superfunds to ensure those who were laid off because of Covid-19 receive financial assistance. The Government will also work with City Hall in Port Moresby to identify families who need food.
“We ask those who are not employed and have no food to go to the church nearest you, give your family’s name or address and we will supply you food rations,” he said.
“But this will not be free food. Those who need food will be asked to spend a few hours of free labour cleaning up your part of the city.”
The Government is also “injecting funds” into commercial banks to provide low-cost borrowing.
The arrangement is for BSP to provide loans at 5 per cent interest rate over 15 years, Kina and National Development Bank at 4 per cent over 20 years. All banks have been asked to defer existing loan repayments.
“Let us all remain optimistic that we will rise as a nation above this crisis. This will not be the last pandemic. Let’s adjust to live with it,” Marape said.