by Serah Aupong – EM TV News, Port Moresby
The Institute of National Affairs Director says the Ok Tedi Mining Limited announcement for a temporary shutdown comes at an “awkward financial time” for PNG.
Speaking to EMTV about the economic climate in the country, Paul Barker says the government needs to stop gambling on future prospective revenues and instead carefully manage what the country has on hand.
With the temporary closure of the Ok Tedi Mine, Barker says that with the PNG government now owning shares in the company, they must remain transparent with the people being affected by the closure.
“These are obviously public assets now so the government needs to be extremely accountable to the people of Western Province and the people of the country about what its plans are, but it’s a little difficult to see the details of this at this stage.”
He says while the reasons for the closures are beyond the government’s control, the closure of one of the country’s biggest revenue earners comes at a difficult time for the country.
“You also have the intermissions in some of the other mining operations around the country as well, and it’s also at a time when basically the LNG revenue is fundamentally going to the creditors who have provided the loans so there’s only dribs and drabs of revenue coming through in dividends and obviously from much lower levels because of the lower gas, LNG prices to Japan, Taiwan and China.”
Earlier last week, while speaking on the closure of Ok Tedi Mine, the Prime Minister said the government is aware of the issues at hand.
“It’s not our doing, it’s not because we are mismanaging the economy. It’s because of global circumstances. That’s why we need to [on a weekly basis] manage our country’s budget, and that’s what we are doing,” Peter O’Neill said.
However, Barker states that these issues were made clear to the government last year.
“Treasury staff and people outside of treasury, were telling the government you need to have a change of the budget for 2015 now. Of course they deferred and sort of denied that it was going to have any impact until now.”
Barker also says that while the country grapples with these economic issues, it must not forget its prime responsibility.
“A lot of factors are influencing what is happening at the moment and it’s really critically important that the PNG government, central bank and other players handle this wisely and responsibly and certainly don’t forget that the real priority.
The purpose of the government is to provide those basic services; law and order, basic , health and education services for its own population.”