PNG Facing massive multi-billion Kina shortfall in budget fundings

𝐈𝐍𝐃𝐄𝐏𝐄𝐍𝐃𝐄𝐍𝐓 𝐑𝐄𝐏𝐎𝐑𝐓 𝐅𝐈𝐍𝐃𝐒 𝐊𝟐.𝟕𝐁 𝐏𝐔𝐁𝐋𝐈𝐂 𝐒𝐄𝐑𝐕𝐈𝐂𝐄𝐒 𝐒𝐏𝐄𝐍𝐃𝐈𝐍𝐆 𝐌𝐔𝐒𝐓 𝐁𝐄 𝐂𝐔𝐓 – 𝐈𝐌𝐏𝐎𝐒𝐈𝐍𝐆 𝐄𝐗𝐓𝐑𝐄𝐌𝐄 𝐇𝐀𝐑𝐃𝐒𝐇𝐈𝐏 𝐎𝐍 𝐓𝐇𝐄 𝐏𝐄𝐎𝐏𝐋𝐄

The latest ANZ Bank Pacific Insight, an independent report on the performance of the National Economy, has confirmed a massive multi-billion Kina shortfall in budget funding that they agree will make substantial spending cuts ‘inevitable’ this year.

The report also confirmed that failure to conclude negotiations on major resources projects including P’nyang, Wafi-Golpu and Porgera will result in ‘irreversible damage to the economy.’

Leader of the People’s National Congress Party, Hon. Peter O’Neill, CMG, MP, said the scale of the economic disaster created by a year of hollow words and inaction is almost beyond belief and the country has had enough.

“The incredible economic potential and opportunities for business investment in our people and country have been wasted by incompetence and self-serving political ambition.

“The harm this government has forced upon our ten million people is now about to get a lot worse if change is not forced on the government, and there is action now to get our economy back on track.

“At the heart of our economy the potential is still there, but there is no hope with the current leadership that refuses to be honest and continues to pursue its foolhardy agenda.

“This independent economic assessment has confirmed the worst fears in the country that the government is out of options to fund the budget, and now our people will suffer for no other reason but incompetence.

“The urgency of the pain that is coming in the following months was made clear by the ANZ Bank report that noted that a funding gap that will result in ‘unavoidable’ spending cuts of at least 2.7 billion Kina.

“To put this in terms of what it means for the men, women and children of Papua New Guinea, there will be drastic spending cuts on vital services in areas such as education, health, police, judiciary and many other areas.

“The only option to cut services is clear, independently verified by yet another high-level assessment, and now Marape has to face the people and tell the country what he will cut and who he will make suffer even more.

“Will it be school and university students and their families, people with disabilities, victims of crime and violence, people attending courts, public servants who will not be paid, and development projects in remote and rural districts that will be cancelled?”

Mr. O’Neill said the only option left is for a smart government to bring the economy back to life through the restoration of business confidence and activity that will stimulate investment, drive business growth and restore the hundreds of thousands of jobs that have been lost.

“Our country is a resources hub with great further agricultural potential ready to export to the Asia Pacific market, and with a capable government, we will again continue to build a bright future.

We cannot wait for five years for Porgera, P’nyang and other projects to come online and start generating income for the Nation, that is a ridiculous statement by Marape.

“Investors and the broader business community are ready to get back to work because they know that a well-managed PNG economy offers tremendous opportunity, but they will not endure further and needless risk from the current government.

“Only 18 months ago, our economy had been moving forward, the Papua LNG agreement had been signed and about to enter into the construction phase, P’nyang and Wafi-Golpu were nearing the successful completion of negotiations, and Porgera was generating hundreds of millions of Kina in National and Provincial revenue and providing essential services in Enga.

“This has all been thrown out the window by populist slogans and pipe-dreams, and Marape has no real strategy to get major resources projects agreements signed by his self-imposed deadline of September.

“For most of this year the government has blamed its failures on COVID, but this is just a smokescreen and distraction, because the truth is that the serious damage started and escalated well before COVID was an issue.

“The people are crying out, business is crying out and most of the Cabinet and Parliament have had enough of empty promises and want to get back to real action to improve the lives of our people.”

Statement

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