PNG seeks IMF loan to ease for­eign ex­change prob­lems

Fiji Sun - - Business -

Pa­pua New Guinea’s Prime Min­is­ter says the coun­try’s cen­tral bank is try­ing to bor­row US$250 mil­lion from the In­ter­na­tional Mone­tary Fund to help solve the coun­try’s for­eign ex­change prob­lems. The Bank of PNG has been re­strict­ing ac­cess to for­eign cur­rency in a bid to main­tain the fall­ing ex­change rate of the Pa­pua New Guinean kina and avoid de­plet­ing its own US dol­lar re­serves. The move has cre­ated a prob­lem­atic back­log of re­quests from busi­nesses to ac­cess for­eign cur­rency for im­ports. PNG Prime Min­is­ter Peter O’Neill said the loan would be used to clear the for­eign ex­change re­quests of ma­jor fuel and rice com­pa­nies. “The Cen­tral Bank is talk­ing to the IMF to cre­ate a tem­po­rary fa­cil­ity of US$250 mil­lion, which they will bring in to make sure they pass it on to the com­mer­cial bank,” Mr O’Neill said. “Then [the Cen­tral Bank will] make sure they clear up the for­eign cur­rency back­log that we have,” he added. Mr O’Neill said the loan re­quired the ap­proval of PNG’s three com­mer­cial banks — Bank South Pa­cific (BSP), West­pac and ANZ — but only BSP had agreed so far. >

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