Importance of talks understood
All PNG businesses recognise and understand the need for the Government to negotiate resource agreements that serve the long term interests of Papua New Guinea, according to Bank South Pacific.
Group chief executive Robin Fleming said the bank also appreciated that any resource project needed to meet all environmental obligations and requirements to ensure the environment was protected.
Fleming said this following queries on what the banking sector’s view was regarding Prime Minister James Marape’s statement during a recent Parliament sitting in which he gave an update on major resource projects in the country.
Marape also pointed out reasons behind the delay of some of those projects.
The projects he mentioned included the Porgera gold mine, Wafi-Golpu project, Papua LNG project, P’nyang gas project and Pasca petroleum project.
“Many businesses in Papua New Guinea continue to experience reduced turnover and profitability due to a combination of the Covid-19 and an absence of new projects,” Fleming said.
“This also invariably leads to fewer people being engaged in full time employment.
“While the Government will provide support for businesses with various infrastructure and development projects the capacity to fund these will prove more difficult over time due to a natural contraction in revenue due to tax collections reducing as business reports lower profits.” Fleming said foreign direct investment especially, from the resource projects was critical for the Government at this time.
“Foreign direct investment by way of resource projects will reduce the burden on Government and provide broad based stimulus that a Government can only otherwise provide by more costly deficit budget financing.”