Future Budgets expected to see significant tax changes, Sovereign Wealth Fund to be finalised in 2018, and Bougainville copper mine landowner leaders reconcile. Your weekly digest of the latest business news.

The PNG government has signalled that future budgets will see more significant tax changes to achieve a broadening of the tax base and a strengthening of revenue raising agencies, according to a 2018 Budget briefing by PwC Partner, Stephen Beach. He told the Lae Chamber of Commerce and Industry that some of the additional tariff protection for the manufacturing sector is welcome news, but probably could have gone further.

He said external funding will hopefully bring relief to the foreign exchange shortage and facilitate more trade and investment flows, but the expected increase in non-mining GDP from 1.9 per cent to 3.5 per cent may be illusionary—outside of Port Moresby.

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Treasurer Charles Abel. Credit: The National

Treasurer Charles Abel says finalising the composition of the Sovereign Wealth Fund, and its board, will take place in 2018. He said the regime to protect revenues is a critical part of the government’s medium term strategy in building the country’s economic resilience.

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The leaders of two key landowner groups in Bougainville have agreed to work together to redevelop the Panguna copper mine. In a joint statement,  Philip Mirori, the Chairman of the Special Mining Lease Osikaiyang Landowners Association and Lawrence Daveona, Chairman of the Panguna Osikaiang Landowners Association, said they would ‘work co-operatively with both the ABG and the national government and call on both governments to respect the wishes of the landowners’.

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PNG Air is set to enter the air freight business when it launches its first freight aircraft next month. CEO Muralee Siva says a Dash 8 passenger aircraft has been converted to a freighter plane, which can carry 3.5 to 4 tonnes.

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The Philippines Government has pledged its support for a large-scale commercial rice production in PNG which will open market access for PNG to export surplus rice to the Philippines. The Philippines Ambassador to PNG Bien Tejano said PNG has excellent rice-growing conditions making it possible for the Philippine government to collaborate with PNG and look into investment opportunities.

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The NDB’s Moses Liu

The demand for loans from the National Development Bank to assist small and medium enterprises has been increasing by 20 per cent annually, managing director Moses Liu has told The National. He acknowledged the allocation of K100 million in the 2018 national budget to the NDB, saying funding has been a major constraint for SMEs to go into business ventures.

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Labour Minister Mehrra Kipefa says the work permits of all expatriates in the country will be reviewed, and the rules for new permits will be tightened. He told The National that some expats have been granted a permit to do a certain job, but then go on to do other things.

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Ten future leaders of PNG’s food and agriculture sectors will be part of the Commonwealth Games in 2018, participating in the accompanying Trade 2018 program. Richard Watson, General Manager of Investment Queensland, says the program ‘opens the door for new collaborations between Queensland and the Pacific region’. Mr Watson said this partnership will build industry capability, inspiring delegates to develop and implement plans for their business.

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The Government plans to invest between K150 million and K200 million to develop Innovative Agro Industry Ltd’s Yalu dairy farm in Wampar, Huon Gulf, in Morobe. Planning Minister  Richard Maru said the 250-hectare Yalu dairy farm would double the size of what was produced at the Ilimo dairy farm outside Port Moresby.

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An Australian Senate committee will investigate ExxonMobil’s Australian tax records following revelations the oil and gas company paid no corporate income tax in Australia for at least two years. Public records released by the Australian Tax Office (ATO) show ExxonMobil Australia reported no taxable income and paid no corporate tax in 2013-14 and 2014-15, despite reporting an annual income of $9.6bn and $8.5bn respectively.

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And finally, a review of government management and expenditure on the Pacific Marine Industrial Zone (PMIZ) project has revealed a K30 million expenditure, including K4 million expenditure on the PMIZ main gate alone, according to Commerce Minister Wera Mori.  The Post-Courier reports the contract for phase one of the PMIZ project was awarded to a Chinese contractor as a condition of the US$74 million (K243 million) loan from the Exim Bank of China.