• PNG Business News

Economy expected to improve

THE country should expect an improvement in domestic economic conditions next year, says executive director of the Institute of National Affairs Paul Barker.

Barker said gold prices were relatively strong and resource companies were due to pay off debts.

He also attributed this to the global economic market conditions including economic activity and demand from China and India, with commodity prices likely to remain restrained, except gold, the country’s second largest export.

“So, in 2020, we can expect to see some of the appreciation. The gold price is stronger,” he said. “Companies like Newcrest, global scale gold producer is probably reaching the late stages of its depreciation on some of its major expenditure on rehabilitation. And LNG is progressing in its payment of debts and building.”

Barker noted that economic conditions and profitability for next year include:

  • A restrain in employment trends, with those low commodity prices;

  • continued foreign exchange shortage;

  • some optimism associated with the completion of the fibre optic cable and terrestrial connectivity;

  • delayed connection with NiuPower to provide more reliable power supply for National Capital District;

  • notably the Wafi-Golpu project seemed off the table for the time being;

  • for Papua LNG and P’nyang currently seemed tenuous having eight year of steady construction phase for those two sequenced projects would provide a major economic stimulus boost and confidence regardless of the agreement, but improved revenue sharing for the State and landowners with earlier benefit flow and forex receipts, would provide longer term revenue benefits without the need for unrealistic upfront success fees.

“Being transparent about revenue and expenditure and not leaving anything out like increased teacher numbers, salary commitments and superannuation.” obligations among others.”

Source: https://www.thenational.com.pg/economy-expected-to-improve/

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