PNG gets $US30m loan from Australia
Copyright 2000 Post-Courier (PNG)
December 20, 2000
PRIME Minister Sir Mekere Morauta yesterday welcomed the granting of a $US30 million loan agreement with Australia.
The $US30 million commitment by the Australian government is in addition to its commitment of $US80 million in June.
“This is a sizeable investment for any country to undertake,’’ he said.
Sir Mekere and Bank of Papua New Guinea Governor Wilson Kamit signed the loan documents in Port Moresby in the presence of Australian High Commissioner to PNG Nick Warner and conveyed it to Sydney for signing by Australian Treasurer Peter Costello and Governor of the Reserve Bank of Australia Ian Macfarlane.
Sir Mekere thanked the Australian government for its continued support through this period of change for PNG.
“It is gratifying to see that the international community is confident in the future of Papua New Guinea and in the ability of Papua New Guinea to turn this economy around,’’ he said.
“With the Government’s program of structural reforms progressing well and with the successful passage of the 2001 budget and the political integrity legislation, I believe that Papua New Guinea is now setting the ground work for strong and sustained growth. The Government thanks its development partners for supporting this vision.’’
Both loans supported the International Monetary Fund’s 14-month stand-by agreement which began in March.
Mr Costello said the provision of the Australian government loans to PNG this year was in recognition of the considerable gains made by PNG in the last 18 months under the leadership of Sir Mekere.
“The $US30 million loan complements the considerable financial and technical assistance already provided by Australia to the reform program,’’ he said.
The loan agreement will be drawn down in three tranches of $US10 million. The first tranche will be made available immediately. The second and third instalments are linked to the second and third reviews of the IMF’s stand-by agreement with PNG.
The interest rate will be calculated as each tranche is drawn down. The PNG government expects that the interest rate will be about 7 per cent a year on each tranche. The loans will be repaid over 12 quarters. Repayments are expected to begin in 2003.