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July 27, 2021
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PM: Treasurer to announce state of economy and debt by June 24

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Prime Minister James Marape has ended his  first official visit to Lae promising  a  report on the state of the economy and debt levels by the 24th  of June

He  indicated it will be  may be an uncomfortable picture that shows high debt levels and lack of investment in key development areas.

“I have, in the meantime, stopped all borrowings until assessments are completed. If we need to borrow in the future, it needs to serve and expand the economy.”

James Marape’s first official visit to Lae  was for multiple reasons.  On the political front,  He was here to celebrate  the Pangu Party’s anniversary  – the party which   is now the largest coalition partner in this new government.

His visit was also important  as he announced a shift in policy and future spending by recognizing  Lae as  an important hub for economic development.   That, however,  was the previous political rhetoric  while billions of kina were pumped into  Port Moresby.

James Marape has been careful  to focus on economic solutions and,   while he acknowledged,  that debt levels are high, he was also careful not to put an official government figure to it.

“Where we invested the money (from borrowings) is also the question we will also be looking at.”

Official estimates place PNG’s debt at around 30 billion kina. That is  what Treasury said in 2018.   What has also created concern is the amount that Papua New Guinea owes  the Chinese Government through  various economic and financial arrangements.

While the government  has to push forward with positive economic policies,  solving some of the debt  problem won’t be easy in two years.

The public service wage bill is a K160 million  per fortnight totaling up to  K8 billion a year.  Tuition Fee Free  funding has never come on time.  It is against that backdrop that this government is looking to  reduce debt and grow the economy.

James Marape spoke to a packed audience  at  the Sir Ignatius Kilage stadium highlighting one of the  solutions that will need a shift in both the political and economic mindsets. Instead of looking at Governors as political adversaries or allies, the provinces have to be viewed as micro economies.

Each of those micro economies  and need the infrastructure to support them.  That means more investment in the provinces, minus the political power play  as well as a recognition that Port Moreby’s money comes from the rest of Papua New Guinea.

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