Photo: Robert Igara
The Independent Advisory Group overseeing the review of the Central Banking Act 2000 and Financial Sector Regulation has been given the clearance to go ahead with Phase II of the review.
Chairman Robert Igara in a public notice said: “With the successful completion of IAG’s phase I work and decision of the National Executive Council in November 2021, the Minister for Treasury approved on April 07th 2022 the Terms of Reference for Phase II of the IAG’s mandate.”
Phase II, according to Mr. Igara, will concentrate on the financial sector in order to examine its regulatory and supervisory structures, expand access for our citizens and enterprises, especially SMEs, across the nation, and develop PNG's government bond markets to lower borrowing costs.
The Central Banking (Amendment) Act 2021, which includes the restatement of the Central Bank's objectives, a strengthened role for the board of the Central Bank, particularly with regard to monetary policy and financial sector regulation, changed governance arrangements, measures to improve transparency and communication with the government, and the introduction of a new financial sector regulator, was successfully passed as a result of the 32 recommendations in the phase I report, according to him.
“We need to encourage competition, investment, accessibility and growth in our financial sector and use modern technology to increase productivity and efficiency, look at our laws governing our banks and institutions as well as the insurance and superannuation industries, and ask whether they are robust enough to support these reforms,” he said.
“We need to relook at our Anti-Money Laundering and Counter Terrorism Act 2014 and whether it poses a threat to the accessibility of our banking system to farmers and small businesses.
“We need to relook at whether our Central Bank has the appropriate legislation to fulfil its functions in light of changing technologies and global banking dynamics.”
According to him, the Phase II terms of reference address a number of unresolved Phase I problems pertaining to BPNG's financial sector governance and commitment to openness. Dissemination, engagement, advice, and accountability.
Reference: Post-Courier (20 July 2022). “Clearance Given For Phase II Of Review, Says Igara”.