The Bank of Papua New Guinea has increased the Kina Facility Rate, Prime Minister Marape welcomes Telstra, and Phase II of the Central Banking Act gets green lighted. The business news you need today.

The Central Bank rejects claims it is propping up the kina. Source: BAI

Finance

The Bank of PNG has increased the Kina Facility Rate by 0.25 per cent to 3.25 per cent to ‘counter the increase in inflation’. It’s the first change since April 2020, when rates dropped from 5.00 per cent.

‘Domestic prices continue to increase since June quarter of 2021 and the Bank expects these to remain elevated for the rest of the year. This is reflected by a significant increase in headline Consumer Price Index (Inflation) of 6.9 percent in March quarter of 2022,’ said Acting Governor Benny Popoitai. He cited ‘high imported inflation caused by the increase in international prices of crude oil and food, from the ongoing supply constraints attributed to the impact of the COVID-19 pandemic and the Russia-Ukraine war’. (Bank of PNG)

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Submissions for Phase II of the review into PNG’s Central Banking Act 2000 and Financial Sector Regulation are due by this Friday 22 July. The Independent Advisory Group in charge of the review says the second stage  will focus on regulatory and supervisory arrangements to help improve competition and access as well as a commitment to transparency, amongst other things.

Robert Igara, Chairman of the Independent Advisory Group, said: ‘We need to encourage competition, investment, accessibility and growth in our financial sector and use modern technology to increase productivity and efficiency, look at our laws governing our banks and institutions as well as the insurance and superannuation industries, and ask whether they are robust enough to support there reforms.’ (Post-Courier)

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The Bank of China (BOC) has established an office in Port Moresby. The office is not in operation yet but when it does it will act mainly ‘as a liaison office’.

‘As a representative office, we are not allowed to conduct any banking activities unlike your typical banks operating in PNG. We are unable to conduct any banking transaction such as to provide loans nor conduct any deposit taking,’ said Wee Li Cheong, BOC (New Zealand) Head of Financial Institutions and Asset Management. (The National)

Telecommunications

Prime Minister Marape has welcomed Telstra’s acquisition of Digicel PNG and said that the move represents an opportunity for PNG.

‘The acquisition will enable our link to the outside world much faster and deeper. I want Telstra to maintain links all over our country especially in the unconnected pockets of our out-of-reach communities, and to grow those links,’ he said. ‘The completion of this acquisition also presents an opportunity for the PNG stakeholders to work on possible participation in the telecommunication business,’ he said. (The National)

Fisheries

The National Fisheries Authority has launched a new fisheries project in Mouk Village, Manus Province. The project’s highlights include a multi-tonne fishing vessel, the FV Lauyang, and solar-powered deep freezers. (Post-Courier)

Aviation

The National Airports Corporation (NAC) has given an update on the new Kavieng Airport terminal building. NAC’s Managing Director Rex Kiponge has said that ‘the construction work on the new terminal building is progressing well and is anticipated to be completed by end of September 2022.’ However, NAC has been holding meetings with the New Ireland Provincial Government and stakeholders because there have been threats by landowners that have delayed the operation of Fokker 100. The runway was completed in January this year. (Post-Courier)

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The National has reported NAC will make a decision on Friday on whether to resume flights into Wapenamada airport. The airport in Enga Province is still closed after a vandalism incident on 7 July. (The National)

Agribusiness

Coffee company Sucafina and the Market Development Facility (MDF) have partnered to develop a data template and calculator for quantifying the carbon footprint of its supply chain (from smallholder farmer to export). The aim is to reduce carbon emissions in Sucafina’s coffee value chain. If successful, the data will be made available to locally owned exporters working with the company. (The National)