May 14, 2017 – By ROSALYN ALBANIEL
THE World Bank will be assisting the Bank of Papua New Guinea establish PNG’s Sovereign Wealth Fund Secretariat.
This was announced last Friday by BPNG governor Loi Bakani during an update on the matter.
“We got a visit from the World Bank and have got someone on the ground to help us set up that office. This is the administrative secretariat reporting to the board of the SWF,” Mr Bakani said.
Mr Bakani said there had been some issues on the appointment of the board of directors for the fund but said this is being handled by accounting firm KPMG under the directions of the Department of Treasury.
“As far as the secretariat is concerned, we hope to have someone very experienced on the ground to set up the office that will coordinate work here and we will set up the office once everything is in order,” he said.
On the issue of revenue flow into the fund, he said the main providers would be companies in the mining and petroleum sector including the LNG projects.
In the case of the multi-billion kina PNG LNG project, he indicated that this was likely to happen round about 2021, 2022 onwards.
“The national budget is framed around that time. This is when government expects the budget will also be balanced.”
“This is when government expects the PNG LNG will start paying taxes.”
“As it is, we have not got any foreign exchange from this project.”
“Until and unless the accelerated depreciation ends, which is seven to eight years, is over since first export in 2014.
“This is when we will see some taxes. It is still a long way away,” he said.