Temu urges pro activity

 By GYNNIE KERO

PAPUA New Guinea needs to be proactive and ensure pipeline projects go on stream given the downturn environment, Chamber of Mines and Petroleum outgoing president Dr Ila Temu says. 

He said this following a glo­bal downturn in the resource industry which would have greater impacts on government revenue and expenditure, mi­ning companies’ operations and planned projects for the country.

“The significant drop in gold prices in recent times and lo­wer mineral commodity prices will impact the 2013 national government budget and put an upward pressure on the budget deficit.”

PNG has attracted some glo­bal resource industry players in recent years but all companies are facing the issue of high ope­rating costs at a time when re­venues are falling.

“There is a gap; not only in price but cost of operating in resource sector increased globally placing significant pressure in the local industry,” Temu said.

“Bringing in new investors will be harder, for existing ope­rators margins become lower.

“There is a downturn in industry globally, from mining side to operation and PNG needs to acknowledge the downturn environment.”

Temu added the current tax review must take these global developments into account. 

He said this was not the right time to increase taxes.

“The industry supports the tax review, adding that the government must also consider the downturn in the industry.

“We have resources available for past 12 years, so the industry has done well.

“Papua New Guinea needs to be mindful, PNG needs to acknowledge the downturn.

“PNG needs to step up; lots of projects in pipeline get shelved because of the downturn,” he said.