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PNG Receives 1KB Loan From JICA

by PNG Business News - March 11, 2021

In support of the 2021 budgets and to boost the pandemic response, the government has secured a K1 billion loan from the Japan International Cooperation Agency (Jica).

The funds will be used to support regional health centres. Jica will disburse about K988 million to help the national budget with an interest rate of 0.1 per cent per annual and four-year grace period which benefits the economy.

According to Treasury Minster Ian Ling-Stuckey, “Subsequently, the PNG government reached out for international support and we thank you (Japan) for responding. Today, we are here to execute a loan agreement that was part of the 2020 financing plan but due to some delays, it was brought forward to this year. There is a process to follow to ensure the loan agreement is consistent with PNG’s Loan Assistance Act of 1971. As the minister responsible, after the signing of this particular agreement, the borrowing will become effective.”

He added, “The loan will support our budget for 2021. This loan continues the Marape government’s policy of replacing expensive commercial loans with good, cheap concessional financing. Last year, based on the financing plan, we raised K5.379 billion in concessional financing and I am proud to say that the total cost of those loans averages about 1.5 per cent and certainly no more than two per cent. That demonstrates our commitment to continue seeking support for concessional financing. Clearly, the strategy here is to pursue a revenue strategy because during the last 15 months under the COVID-19 conditions, the Marape government is focused.”

 


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