Is the 100 Days – 25 Point Plan Practical and Achievable ?

By Francis Hualupmomi



It appears that the government has admitted that there has to be a macroeconomic discipline in rescuing the current economic situation. And it has put forward a 100-Days 25-Point Plan economic rescue package for the country based on the Alotau Accord II. But is this package realistic and achievable? Therefore, this article seeks to respond to this question.
The Current Economic Situation

Source: ADB 2017 Outlook https://www.adb.org/countries/papua-new-guinea/economy



According to the Asian Development Bank Economic Outlook (2017), the PNG economy has slowed down to 2.0 percent compared to the last four years (see the figure above). But it is predicted to pick up again at 2.5 percent by 2017 driven by mining and agriculture. The slowdown in the economy has been attributed to low commodity prices. This has increased inflation and unemployment, decreased foreign reserves, and affected the national budget.

Macroeconomic Landscape
It appears that the economic approach undertaken by the government over the last four has been one of an Expansionary. At the fiscal policy level, it has been driving the economy with high spending and borrowing at the backdrop of a decade long economic growth. The rationale is simple – utilise the surplus to expand the economy through infrastructure development which will, in turn, stimulate the economy. As a result of this approach, the economy has experienced an infrastructure boom in the economy as has been so far.
At the monetary level, it has been responding to the fiscal policy to ensure that the economy remains stabilised. It is important to note that in a country like PNG, monetary policy approach responds to fiscal policy to ensure stability. In so doing, it controls exchange rate and interest rates which tend to influence inflationary (inflation) behaviour.
Unfortunately, this macroeconomic policy has been affected by an unfavourable condition. There are two related factors, apart from others, that affect this behaviour. First, is that our commodities have been hit hard by low prices in the global market, which we have no control over. As a result of this price fluctuation, the revenue sources have been affected to sustain the fiscal capacity (budget). Because PNG is a resource-dependent economy that relies heavily on mineral and petroleum sectors, a price fluctuation in the global market will directly affect the economy in terms of growth and development. That is one of the reasons why the budget has been cut in certain social and economic sectors.
The second factor is that while the expansionary approach has been good it has not been managed at a sustainable level. What it means is that as the commodity prices slowly began to pick up again there has been a steady increase in the spending and borrowing. The reason is that there is an expectation that price will pick up again as in normal business cycle and sustain the expansionary approach. The downside of it is that it is quite difficult to predict the price fluctuation due to the complex interaction of market forces. As a result of this fiscal behaviour, the budget spending and borrowing has increased the deficit. However, the budget deficit can be improved and incrementally restored to normalcy through a sustainable macroeconomic policy package. Therefore, the next part will discuss this.

The Viability of the New Macroeconomic Rescue Package
The new Deputy Prime Minister and Treasurer, Hon Charles Able, has realised the downside of the expansionary macroeconomic approach. And he has proposed a 100-Days economic package to rescue the economy from further sinking. In essence, this is a 25-Point Plan which has been widely consulted with the private sector and led by some of the senior ministers and economic advisors. While this package may seem unrealistic to some critical commentators, in my view, it is a workable and achievable one.
The 100-Days 25-Point Plan intervention is based on these key strategic economic priority areas:


• Maintain Fiscal Discipline and Boost Foreign Exchange; Growing Our Revenues;
• Strengthening Our Economic Base;
• Improving Our Governance Record, and;
• Acting Strategically
.
First, maintaining fiscal discipline and boost foreign through the growing of revenues. Given the issue of the fiscal problem, practically maintaining a fiscal discipline in a prudent manner will help boost the foreign exchange in many ways. That means controlling and spending behaviour as compared to previous years. And this must be balanced with growing revenues through multiple sources. Incoming revenues must be prudently managed in a sustainable way. What is collected should be spent on strategic priority areas that can bring in higher returns.
In addition, the tax cut will be a balanced strategy. This is because no new taxes will be imposed on ordinary people despite declining revenues. However, this can be recovered through those who avoid or and evade tax. The country has been missing out on the billion dollar extractive industries through tax. For instance, a lot of companies in the mining, petroleum and logging industries have been avoiding or exempted from tax. As result of this, billions of Kina have been going out of the country. These lost revenues could be recovered and help support the budget.
Secondly, strengthening of the economic base is an innovative plan to invest in economic areas that have been ignored. This implies that the economic base must be diversified to boost the economy by way of revenues sources and invested in a lot of baskets to cushion economic surprises. Apparently, the focus on agriculture is pragmatic going forward. It has been a neglected billion dollar sector. Therefore, it is hoped that this will incrementally support and sustain the budget. 
Moreover, while the plan sounds practical, the governance aspect of it is fundamentally critical. The government has been widely criticised by the public for governance issues. And this approach is a noble plan to improve its credibility and international standing. In so doing, it will help its approach in prudently governing and managing the economy. Because investor confidence attracts investment and helps build the economy. Political governance is the strategic driver of economic growth and development at this time and in the long run.
Finally, these plans must be pursued in a strategic way. Every decision requires calculated available options to maximise optimal outcome. The government has chosen the best strategy therefore, it is Directionally Correct.



In conclusion, the economy has been affected due to the changing economic conditions and governing approach. And this has been evident in the current economic situation the country is facing. But this can be arrested through a sustainable macroeconomic approach. Therefore, the 100-days 25-point plan package is a practical one and needs to be incrementally governed and managed in a strategic way.

Francis Hualupmomi is a PhD Student in Public Policy in the School of Government, Victoria University of Wellington. He is a Political Scientist in the area of political economy of energy security, geopolitics of resources, international security, and strategic policy. Views expressed here are his own. francishualupmomi270@gmail.com 

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Ela Beach gets timely Facelift

By: Jonny Andrews

I have been watching with interest the developments happening at Ela Beach.

It saddens me that most of the trees will be cut for this development but I am reminded that in order for something/someone to be remold they had to be broken into many many pieces.

Papua New Guinea is growing and with growth comes development. Development of infrastructure,  development of its tourism industry and development of its landscapes.

We continually compare ourselves to the Arab Nations but we must understand that, they reached that stage by starting off where we are right now. It was not an overnight miracle, it was a progressive development that changed their nation.

The Ela Beach Redevelopment it seems has 3 Contractors working on it.
1. Apec Haus and the Marina by OSL
2. Ela Beach Waterfront by CHEC
3. ?????  – this would be another company which will develop the area towards Koki

It is not only the Beachfront that is getting developed, the properties opposite the road would also see development. Currently, there is a plan to redevelop the IEA School, Ela beach hotel and properties inline with the whole development of Ela Beach.

This development of Ela Beach will join the Paga Hill Development and make it one of the biggest Development in the Pacific Region compared to other Pacific Island Nations.

Papua New Guinea is moving forward, it is time we also move our mindset and look forward to greater participation in our own land.

 


Port Moresby’s iconic beach to be modernized at a cost of K55 million. New developments to include APEC and a 4-lane highway
THE Hiri Moale Festival will be allocated space in the current redevelopment of the iconic Ela Beach in Port Moresby.

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Redevelopment of IEA in Ela Beach

This was made known by Member for Moresby South Justin Tkatchenko when he responded to questions on the redevelopment of the beach.

He added that the Motu-Koita Assembly, the voice piece of the Motu-Koitabu landowners of traditional Port Moresby, was in agreement of the redevelopment of the beach front which would bring in new jobs.

The annual three-day event, which culminates in the crowning of Miss Hiri Hanenamo, promotes the culture of the Motu coastal villagers

Mr Tkatchenko was also asked on the controversial issue of the land title which he fought to have extinguished after it was awarded to Awak Holdings Limited two years ago.

“I did not agree with the way the title was handed to Awak Holdings via the Lands Department.” Awaks development plan had also entailed reclamation of the shorefront about 50 metres but it met with opposition from Mr Tkatchenko and traditional landowners.

09ak_trees_0
Ela Beach Redevelopment by China Harbour Construction

“The beach front comes under National Capital District Commission and it is State land, open space and recreational.”

He added that after the extinguishing of the land title, the title was publicly tendered by NCDC and awarded to Cardno and China Harbour Engineering Company for the roadworks.

The Ela Beach Foreshore Development Plan was unveiled in September last year.

In that plan the beach front will undergo two stages of development with stage one will see completion of APEC Haus to be constructed on NCDC’s sea park land. APEC Haus will be the venue for the Asia-Pacific Economic Co-operation Leaders’ Summit next year.

The second major development would be the construction of Ela Beach Road as a four-lane road to align with Healy Parade and Paga Point Ring Road; construction of about 300 car parks; and redevelopment of Ela Beach as per the unveiled master plan.

NCDC had dedicated its land being the former sea park jetty for the construction of APEC Haus. Post Courier /ONE P

 

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$17 million road improvement, beach extension project in Port Moresby

By Benorah Hesehing

PORT MORESBY, Papua New Guinea (The National, Feb. 10, 2017)

Work will begin today to give Port Moresby’s iconic Ela Beach a K55 million [US$17 million] facelift.

 

NCD Governor Powes Parkop said the redevelopment project involved the construction of a two-lane road and an extension of the beach by another 100 metres.

“The work will begin tomorrow (today) and I am calling on the public for their understanding and cooperation,” Parkop told a media conference yesterday.

“There will be some disruptions for the earth work but we intend to keep the existing roads operational while the new lanes are being constructed.

Ela beach Road Map
Road Map for Ela Beach Redevelopment

“Some of the trees, shrubs and palms which provide shade would be removed to create way for construction.”

He added that the National Capital District Commission was doing all it could to retain the old trees. “We understood that the older trees were part of the Ela beach heritage and are working hard to save those, which can be saved,” Parkop said.

He said the people should not think about what they would lose, but what they would gain from the redevelopment project.

Ela-Beach-Marina-Development
Ela Beach Marina Hotel

Moresby South MP and Minister for Sports and National Events Justin Tkatchenko said the project was a “fantastic achievement for NCDC”.

“We can plant advanced trees within the landscaping for Ela Beach to ensure what is replaced is suitable or even better,” he said

Ela-Beach-Marina-Development-1
Ela Beach Marina with APEC Haus in the Middle

 

Kumul Telikom Holdings – Right Stepping stone for Papua New Guinea

By: Jonny Andrews

Telecommunications is the ‘Heart-beat’ of every thriving economy!

How does one disrupt and conquer a nation? They simply break down the communication between all important Government utilities and department. Put them into a state of confusion and slowly conquer and take control.

Sound familiar???

The advised Papua New Guinea has been getting in the past of ensuring competition and to separate the Telecommunication entity has been flawed! It has resulted in the State communications entity competing against itself and ensuring that the real competitor succeeds!

The birth of Kumul Telikom Holdings is the realization that we have lost the plot and the need to get back on track is imminent! Kumul Telikom Holdings is the ‘Stepping Stone’ on improving the Telecommunication system in the country. 

It provides for a SINGLE Board that ensures the DataCo, BMobile and Telikom Management works effectively, do no compete against each other and provides a roadmap that actually provides greater benefit to the country.

Well done PNG Government!


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Consolidation of SOEs right move: Barker

March 6, 2017The NationalMain Stories

 Article Views: 169

The recent consolidation of telecommunication State-owned enterprises under Kumul Telikom Holdings “is the right way forward”, according to Institute of National Affairs executive director Paul Barker.

Barker, pictured, told The National that this arrangement would be ideal if complemented with effective management that resulted in enhanced competition in the sector for the benefit of businesses and rural areas.

“Consolidation of the domestic network and linking the key gaps, notably the Northern network with the Hides-Port Moresby link, while rationalising the multitude of State-owned entities, is the right way forward, so long as the best professional board and capable, innovative but prudent management is in place,” he said.

“Operations also be accountable and transparent.

“Real rather than superficial competition is needed, but it’s not logical for that competition to be between ill-resourced State-owned entities but between a stronger, single telecommunications State-owned entity and the other players.

“Consideration of selling off or part sale of the State-owned entity may be considered to increase capitalisation and capacity but the State retains an important role in this space as regulator, encouraging and requiring competition, and ensuring priority services reach the wider communities of PNG, as well as enabling businesses across the country to function, including in rural areas.”

Barker highlighted the need to upgrade Government-owned telecommunication infrastructure with possible adjustments to increase bandwidth from submarine cables.
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MINISTER ABEL CLARIFIES THE KUMUL CONSOLIDATION AGENDA
Wednesday February 22, 2017 –Minister for National Planning, and Acting Minister for Public Enterprises and State Investments   Hon. Charles Abel today called a media conference to clarify the Government’s main policy priorities through the Kumul Consolidation Agenda.

Minister Abel stated:

* At the outset, our focus should be on ensuring that all relevant boards and MDs/CEOs of the SOEs are in place and addressing all operational issues;

* The government’s overarching objective is to progress the social and economic well-being of the citizens of Papua New Guinea;

* This includes promoting an efficient enabling environment (policies, regulations and legislations) for private sector as the primary generator of wealth and job creation to flourish;

* Government generally only intervenes in the private sector as an active participant when private capital or entities will not and the particular service is vital or strategic;

* The Kumul Consolidation Agenda is intended to improve synergy, coordination and efficiency to the National Government’s participation in commercial activities;

* This includes the aggregating of related Government companies in different sectors such as Telecommunication, energy, agriculture, etc;

* The Department of Public Enterprises is to provide policy development and oversight in concert with the Minister and Cabinet. It is not to get involved in project development. Any such projects are to be handed over to the relevant subsidiary companies or ceased;

* KCH is to oversee the implementation of government policy through the respective subsidiary companies including the most appropriate corporate structuring in relation to the non-mining & petroleum related majority owned government companies;

* This government policy includes capital structuring to involve private capital and management as much as possible;

* KCH should cease developing numerous business projects and only get involved in project development for large scale strategic capital projects on behalf of the sector specific subsidiaries;

* All government companies should generate an adequate return of capital; and

* All government companies should be restructured in order to free up resources and introduce efficiency into the economy unless there is a particular strategic interest or private capital cannot be attracted.

In closing Minister Abel said that KCH needs to regroup and refocus on the job ahead and he was confident that it has a solid foundation of sound corporate governance that would expose and address weaknesses, and identify opportunities if and when they arose.

“I have assumed the role of caretaker Minister of this important Ministry with only two months before the National Elections.”

“In that short period of time I intend to create focus and clarity, and highlight the synergy between National Planning and the three entities – Kumul Consolidated Holdings, Kumul Minerals and Kumul Petroleum.”
Sources:

http://www.thenational.com.pg/consolidation-soes-right-move-barker/

http://www.kch.com.pg/minister-clarifies-consolidation/

ADB Helps PNG Expand Port Moresby International Airport Using PPP

By: The FINANCIAL

The Asian Development Bank (ADB) and the Papua New Guinea (PNG) National Airports Corporation (NAC) signed a transaction advisory services agreement to develop a new international passenger terminal at Port Moresby (Jacksons) International Airport through public-private partnership (PPP) on 2 February 2017.
“ADB has been a key development partner to NAC for several years through the landmark Civil Aviation Development Investment Program,” said Marcelo Minc, Country Director of ADB’s PNG Resident Mission. “Through this transaction advisory support to NAC for the Jacksons airport, we hope to complement the work we are doing across the PNG aviation sector, develop a regional hub for air traffic in the Pacific, and create a template for delivery of PPP projects in the region.”

The project will use a PPP scheme where the private sector will design, build, finance, operate, and maintain the airport facilities. A new international passenger terminal, the extension of the main runway, and other infrastructure enhancements will help the airport meet forecast air services growth up to 2040. The concession period and other parameters will be determined based on the feasibility study, according to ADB.
ADB’s support is part of its ongoing assistance to PNG to identify and develop PPPs in the transport sector, a key priority in ADB’s 2016-2020 Country Partnership Strategy for PNG. ADB has been supporting the government to improve 21 national airports to provide safer, more secure, and all-weather air transport services through the Civil Aviation Development Investment Program. Jacksons International Airport is part of the program.

The project will be ADB’s first PPP transaction advisory engagement in PNG and the Pacific. As part of the agreement, ADB also aims to create document and contact templates that may be used for future PPPs in the region and to build local expertise in PPP management and execution.
http://www.finchannel.com/business/63208-adb-helps-png-expand-port-moresby-international-airport-using-ppp

The 6 largest building projects set to change Port Moresby

This year’s business forecasts in PNG are looking more modest than previous years, but there’s no doubting better things are on the horizon for Port Moresby in 2017. The city’s skyline is set to change over the next eighteen months with the addition of new commercial, residential, hotel and retail buildings planned across the region.

With a range of projects in various stages of development, it’s a race against time to complete them before the APEC 2018 Summit. Even with project management, design and investment expertise from around the globe, the clock is ticking on the completion of Port Moresby’s newest buildings. Here’s Peopleconnexion Recruitment’s visual guide to the city’s latest projects.

1. Star Mountain Plaza

It seems fitting to start with talking about Star Mountain Plaza. Set to provide hotel, office and residential spaces ahead of the APEC 2018 Summit, Star Mountain Plaza is PNG’s first integrated commercial development. The K1.5b project is due for completion in August next year, under the project management of Stratum. Check out the first 30 seconds of this video to get a sense of just how huge this project is.

 

Architect’s aerial view mockup (source)

Attached Hilton development (source)

2. OPH Tower – Stage Two

Stage Two of the redevelopment of Old Parliament House in the city’s centre is officially underway. This stage will feature twin residential towers and penthouse apartments leased to corporate clients, paired with retail space. Official construction works began early last year and are set to be completed in late 2018.

OPH Commercial Tower (source)

OPH Two render (source)

OPH Two render (source)

3. Rangeview Heights

The commercial and residential estates in to be located in Waigiani’s City Centre are currently being developed by Lamana under their subsidiary Rangeview Heights Limited, of which Managing Director Sir Kostas Constantinou holds a directorship. The development includes residential townhouses, an attached shopping mall within the community, secure parking, a park and green areas for residents’ use.

Rangeview Heights mall (source)

Aerial view (source)

4. Paga Hill Estate

Paga Hill is set to be the city’s first multi-use development including luxury hotels, over 800 residential apartments, commercial and retail spaces, a marina and cultural centre. The project has been in proposal, planning and design development stages for years, but is finally ready to begin enter its investment and implementation stages after receiving the green light from the Government earlier this year. Estimates currently put the construction of attached Paga Hill City at around K3 billion.

Aerial view (source)

Artist’s rendering (source)

5. APEC Haus

The next iconic PNG landmark is expected to start construction early this year. To complete this K120 million project, Ela Beach will be extended out by 100 metres to support the structure, which will be built over the water. From the air, the building’s shape will resemble a traditional Moutan lakatoi sail.

“When you see it from the air, or when you see it from the land or when you see it from a post card or on TV, or on the internet or Facebook, you will symbolise and recognise it as Port Moresby, Papua New Guinea,” – Justin Tkatchenko, Minister for Sports and APEC

The construction of the building will be part of a larger Ela Beach redevelopment project involving a four lane highway to join the Paga Ring Road.

Artist’s render (source)

 

6. Loloata Island

Loloata Island Resort is still very much a work in progress. After being sold late last year, the former dive resort is set to be redeveloped into a luxury hotel with suites and private villas. Though technically not located in Port Moresby, this project’s massive undertaking makes it a development worth mentioning.

Aerial view (source)

Depictions by architects ThomsonAdsett:

Pros and Cons of Hosting the APEC Meeting in Papua New Guinea

By: Ludwig Aur Aba

Asia Pacific Economic Cooperation (APEC) is a very important international organization and PNG hosting APEC meeting will bring together very important leaders of superpower countries like USA, Russia, China, Brazil, Australia, Indonesia, Japan and others. There will also be other observer countries as well. PNG was privileged to have been awarded the hosting rights in the last meeting, mainly because of its status as one of the fastest growing economies in the Pacific and the APEC leaders at that time were impressed on the performance of PNG economy, hence the nomination and selection. It was indeed a privilege for PNG in the eyes of the world to have been selected ahead of other countries, which were also nominated.

screen-shot-2015-11-19-at-5-42-25-pm

A good number of people have raised concerns about the benefits of hosting the APEC meeting in 2018, at a back of a suppressed economy and dilapidated state institutions and infrastructure. Several responses were provided but it does not give detailed information about how the country is going to benefit from such an important international event. At the outset, it is quite understandable why people are unhappy about hosting such an international event, when the country has cash flow problems, limited employment opportunity, dilapidated infrastructure, break-down of state institutions, poor social and health indicators. They are questioning why spending K120 million (could be more) on the event, when the economy is in bad shape.

It is worthwhile, a detailed explanation of the pros and cons of hosting such an important event is made to every concerned citizen so they are aware of the costs and benefits.

 

Pros

1. Raise profile of Port Moresby and Papua New Guinea

Raising the profile of our city can lead to lasting economic benefits, not only for POM but PNG as well. For example, cities which hosted the Olympics and other international events have seen a persistent increase in recognition and tourism. Like other international meetings, hosting the APEC raises a country’s profile, which are important in generating new economic benefits and business investments since the day PNG was selected to host the APEC. The importance of this is that it can change the views of the world on Port Moresby, and PNG, especially when POM was ranked as one of the most unlivable cities in the world and PNG has the most corrupt country. There are other aspects of Port Moresby and PNG the world does not see, let’s work together and give them these. Port Moresby is always in the front pages for the wrong reasons, PNG should capitalize on this event to get united and show the world that PNG is different from the rubbish that are published in the media. If there is going to be any chance to increase the profile of Port Moresby and PNG, it is definitely the hosting of APEC.
Why is Port Moresby given too much attention and not other centers? The first answer is Port Moresby is the capital city of PNG and as such, it must be treated as a capital city. You look at Sydney, Tokyo, London, New York, their governments and the private spend lots of resources to bring to where they are now. The country is changing and we must change and accept new developments. Most of these infrastructures have created thousands of jobs for our people. These infrastructures will still be here for our future generations to use. In my opinion, we must give Port Moresby the treatment it deserves to be our capital city, which all of us can be proud of, and our visitors can enjoy.

2. Long term Trade, Investment and Jobs

A significant benefit Port Moresby and PNG benefited is the long-term investment, which comes from preparing for hosting APEC. The preparation did not start yesterday, it started when PNG was selected as the host country for APEC 2018. The POM and PNG will have a legacy of improved infrastructure including venues that should address some of our daily traffic worries. Unlike, other investments, infrastructure is very expensive to build and people should accept this fact. POM should invest heavily in infrastructure and public transport to cater for the influx of not only our visitors but our increased population. This will leave a legacy for residents of POM, they will benefit from improved public transport. Any new investment bring with it jobs, and this may proof beneficial for PNG because the several years of planning and investment will help create jobs and can revive POM and can boost economic output.
Apart from the investments infrastructure and public transport, leaders of major business corporations will be here as well. They will be looking for opportunity to invest their dollars. They may strike trade deals with PNG-based corporations or resources owners. New Business deals could be struck and the employment benefits will be immense. In the long run, such deals will continue to provide employment and tax benefits to the country. Countries may also sign trade treaties or other areas of cooperation that may benefit PNG as well.

Some of the short-term benefits of hosting such events are the logistical and transportation services, which will also benefit from hosting such events. The hotels and catering services will serve our guests (in terms of bed, food, drinks etc). The security services will be increased. These will be immense. Added to these are the inflows of foreign currency, especially US dollars. Some of the leaders will be here with their spouses and other relatives and would like to spend on something that they will remember. These will benefit cultures. We should showcase our cultures to the world. PNG should be showcasing our cultural diversity, the more than 850 different languages to the world leaders as a promotion to attract more tourists into PNG in the future. East New Britain will also host some of the APEC meetings, they will also benefit from the meetings, including hotels, security, showcasing our cultures and selling artifacts etc.

These long and short term investments and spendings are important given the state of economy, by creating jobs, and can help create economic recovery. The investment has potential for leading to higher growth and higher future tax revenues.

 

Cons

Although hosting such important events are beneficial in economic wise, there are other things which may not be so good. For example;

1. Cost of building the infrastructure

To host an Important Event like this, require huge capital investments, which should be paid for by tax payers, unfortunately. The Costs of building these infrastructures have a tendency of going up and could be much greater than expected. Associated with the cost over-runs are the over inflated contracts, and the involvement of politicians in such contracts. These are the main issues. Politicians should not get the dirty fingers in such big projects. Unfortunately, we are in PNG and cannot avoid that.

2. Short-Term use

The other important thing is that many of facilities built for the APEC can never be fully used again. It will rarely be full outside of the Olympics. This can be mitigated by careful planning.

3. Potential for negative publicity

If things go well, a POM can benefit from positive publicity, but if things go badly, it can cause the opposite.

4. Cost of Security

The budget for the security will be biggest slice of the cake. Like any major events, this APEC should increasingly implement higher levels of security. This is both costly and can restrict freedom of movement of local citizens during the meetings.

4. Borrowing and Increase in Debt

Also, one bad thing about hosting such events is that, it eats into the budget of the host country. With the current difficult economic times PNG is facing, it has no choice but to borrow and fund the activities leading up to the APEC meetings. This may add to the overall Government debt of PNG, which will eventually be paid by the tax payers.

 

Conclusion

In my view, it is understandable why people complain about the spending by the Government to host the APEC, while other areas are suffering. But developing Port Moresby is not wrong, it is our capital city and we have to develop it. In life, there are always trade-off, we can’t get all we want. We should make some sacrifices, and in the meantime, the sacrifices are being made by the 7.5 million people of PNG to host this very important economic meeting. Let’s make use of every opportunity from this meeting and try and get something out of it to compensate for our sacrifices.

The importance of this is that it can change the views of the world on Port Moresby, and PNG, especially when it is ranked as one of the most unlivable cities and the most corrupt countries in the world. There are other aspects of Port Moresby and PNG the world does not see, let us work together and give them these. Port Moresby is always in the front pages for the wrong reasons, PNG should capitalize on this event to get united and show the world that PNG is different from the rubbish that are published in the media more frequently. If there is going to be any chance to increase the profile of Port Moresby and PNG, it is the hosting of APEC.

Let us not kill the enthusiasm to host such international events. PNG has come of age, though we have problems, they are not unique to PNG. Every country has its own set of problems, it’s not only PNG. President of US, China, Japan, Russia and others will be here. PNG just had this rare opportunity to host them. We should feel privileged to host such very powerful and important leaders on earth.

I hope I make some sense here.

Reduce Fuel Prices in Papua New Guinea

Last week, Board Chairman of Air Niugini Sir Frederick Reiher on christening the 4th Fokker 70 aircraft in Alotau, spoke on the Air Niugini’s submission to making air travel affordable for Papua New Guineans by reducing Government Taxes.

While that is a great initiative from Air Niugini to encourage Tourism and lower airfares, the Government would do the people of Papua New Guinea justice by lowering the Fuel prices in Papua New Guinea.

One way to achieve that is to encourage InterOil who has a refinery in Port Moresby to sell cheaply to local suppliers and additional to provide a Tax subsidy for distributors.

Lower fuel prices leads to lower overall transport costs around Papua New Guinea…..as transport costs drives the price up……

airniugini-1-of-8

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Air Niugini to push for cheap airfares
September 30,2016, 12:00 pm – Post Courier

Air Niugini will put a submission to the National Government to make air travel affordable for Papua New Guineans.

The announcement was made by the airline’s board chairman Sir Frederick Reiher at the naming ceremony of another Fokker 70 aircraft. The plane, the fourth in the series, was christened ‘Alotau’.

He said the national airline was keen to partner with the National Government to achieve two goals: a significant growth in tourism and tourism numbers and to help make it easy for PNG families to travel on domestic air services.

He said it is probably not known that government taxes and charges make up a substantial proportion of the total cost of domestic airline tickets.

He said the level of taxes and charges vary on routes that Air Niugini and its subsidiary airline Link PNG serve. Up to a third of the total cost of an average ticket comprises taxes and charges.

“Air Niugini is also impacted of course by fuel taxes, the cost of which is passed on to our passengers. We have been considering for some time how we might be able to work with National Government to make airfares more affordable firstly for families and local businessmen and women and secondly for our tourists,” he said.

“I appreciate the national budget is also impacted by economic circumstances but I am confident this measure will would provide a real lift to the economy and would deliver higher return to the government over the medium term.”

Planning Minister Charles Abel, who was present for the event, noted the concerns and admitted that tax did constitute up to 50 per cent of the cost of airfares.

He said government revenue was constrained to some degree and there was a reluctance to reduce taxes. But all options will be considered given the broader implications and gains expected.

“Lowering airfares will support tourism and create these huge economic benefits at home so we do acknowledge that and we do commend the PX board and management and staff for the reforms it has undertaken in these difficult times,” he said.

By the same token he also highlighted that while times were tough there had been some positives including a reduction in fuel prices. He challenged the airline to see if this could translate to lower airfares on fuel surcharge.