Treasurer signs financing agreement with Australia

TREASURER Ian Ling-Stuckey has signed a financing agreement for about K1.4 billion with the Australian Government.
Ling-Stuckey said the agreement involved two elements of the 2020 Budget financing plan of cheap, friendly financing assistance.
“The financing agreement provides around K1,380 million of financing, with interest costs of zero because of the G20 debt relief,” he said.
“After the debt relief period, the financing moves to interest costs linked to a 10-year Australian government bond yield which is under 1 per cent per annum.
“The first part of the assistance is an additional AU$140 million or K350 million to support the 2020 Budget.”
Ling-Stuckey said the focus of the Marape-led Government was to use the funding to pay off massive debts.
He said under the International Monetary Fund monitored programme, they had agreed to set up an arrears verification committee to check and verify outstanding contract payments.
“With these payments, we are injecting cash back into our local businesses,” he said. “The business community says paying arrears is one of the most effective ways to support the economy during the Covid-19 pandemic.”
Ling-Stuckey said the second part of the assistance was to rollover the K1.028 billion (US$300mil) in the 2019 financing provided through a short-term loan from Export Finance Australia.