Market update

A total of 3,499 nominations have been accepted by the Electoral Commission (EC) nationwide for the 2022 general elections. In 2017, a total of 3,340 candidates contested, fewer by 159. Electoral Commissioner Simon Sinai also said 142 women (167 in 2017) or 4% of the total number of candidates were contesting for the 118 seats in Parliament.

Pacific countries, including Papua New Guinea, have declined to sign a regional economic and security deal with China after a meeting between Pacific foreign ministers and China’s Foreign Minister, Wang Yi. It’s been reported that several nations wanted to either defer action or have the draft amended. The deal covered a free trade area, humanitarian and COVID-19 relief and security matters, amongst other things.

PNG’s outlook has changed to stable from negative, ‘B-‘ long-term, and ‘B ’short-term ratings have been affirmed, according to S&P Global Ratings. The revision comes because of the higher commodity prices. The ratings agency also expects a ‘modest economic recovery of +1.7% in 2021’ and economic growth to pick up further in 2022.

The first gas from the Angore development project is expected in 2024, according to Santos Ltd. Upstream Oil and Gas president Brett Darley said at the end of last year, the company announced the next tranche of backfill gas to maintain PNG LNG production with the final investment decision on the Angore development project. “First gas is expected in 2024 and the project will see Santos’ share of capital expenditure be approximately US$135m.

The PNG Customs Agency is undertaking various reviews and reforms to improve its systems and processes to facilitate trade and reduce the cost of doing business in the country, says Chief Commissioner David Towe. Towe told the Customs Business Consultative Forum recently that these involved modernizing customs payment systems as well as reviewing some of its existing laws such as section 107 of the Customs Act for bank guarantees on temporary imports among others.

The PGK300m Rangeview Plaza investment by National Capital District (NCD) and its partners is the first for NCD to have ventured into major business investment, Governor Powes Parkop says. The decision to enter into this project enables the Commission and the city to be equity holders and will support the NCD Commission to expand their revenue base. The precinct covers a combined net area of 52,000 square metres consisting 88 townhouses; recreational and retail amenities.

PNG Small and Medium enterprises (SMEs) can now try to improve their businesses through a partnership between SNS Tech and Kina Bank PNG. SNS Tech, a nationally owned technology firm, has entered into partnership with Kina Bank to support SMEs in the digital economy. “Customers can then pay for products and services instantly using Kina Bank’s internet payment gateway,” SNS Spokesperson announced. “What was once only accomplished by large companies in the country is now the best move forward for these enterprises.

This week’s BPNG Treasury Bills auction results indicated an overall oversubscription of K256.77m from the total offer amount of K327.72m. The weighted average yield for 182, 273 and 364 days dropped by 0.15%, 0.6% and 0.39% respectively to 1.68%, 2.90% and 2.98%. Nil offer for 63 and 91 days series.

This month’s BPNG Treasury Bond (GIS) auction results indicated an overall oversubscription of K76.5m from the total offer amount of K700m. A total of K500m bids were successful in the 2yrs, 4yrs & 7yrs series. The weighted average yields for the respective series generally dropped from the indicative yields. There was no successful bid for the 8yrs, 9yrs & 10yrs. bond series.

Both the KSi Index and KSi Home Index remained unchanged to close the week at 6,261.69 points and 15,356.56 points respectively.

The Enga government has made a loss of almost PGK70m since the closing of the Porgera gold mine two years ago, Governor Sir Peter Ipatas says. Sir Peter said since the mine’s closure, all stakeholders had made losses but people had to be patient so that the final agreement could be signed for the reopening.

Agriculture and Livestock Minister John Simon says rice is still a program under the Department of Agriculture and Livestock and it is time it gets all the support it needs through the development of a rice policy. Simon said having visited Bangladesh recently, a country with more than 163m people and in an area of estimated 148,460 square kilometres, they were rice sufficient. “When you look at PNG, 460,000 square kilometres, our arable land is well over 300,000 square kilometres,” he said. “They (Bangladesh) are rice sufficient, they are one small country that can feed their own people, we can’t, we keep talking about it (local rice production), these are some of the things that we need to correct the papers and do these.”

The 2022 General Elections will not stop the regulatory process for the reopening of the multi-billion kina Porgera gold mine in Enga, Mineral Resources Authority (MRA) managing director Jerry Garry says. Garry said that the only event that might be impacted was the development forum which would be dictated by security issues as a result of the recent tribal fight in the Porgera valley.

ANZ Bank forecasts a positive economic growth for the country on the back of upcoming resource projects. The next tranche of gas projects will be the initial driver with Papua LNG anticipated to go into Feed (Front End Engineering Design) by June this year, laying the groundwork for a much-vaunted construction boom from late 2023 into 2024.

Certain businesses will benefit in the general election period with an increase in cash flow, according to the Port Moresby Chamber of Commerce and Industry. President Rio Fiocco said businesses who provided printing, hire car, and motor vehicle sales would benefit. He also warned business houses in Port Moresby to take extra security precautions and if need be, install closed circuit television camera’s because there would be opportunist throughout the period where large crowds would gather.

Puma Energy PNG is worried that the foreign exchange issue in the country could drive the business to an unsustainable level if not resolved. The Country Manager, Hulala Tokome said, “We are engaging with the Bank of Papua New Guinea and commercial banks to address the issue. With FX issues, we continue to have challenges in clearing our FX requirements.” In regards to Governments removal of excise and goods and services tax for fuel, Mr. Tokome said that Puma has yet to receive a Gazettal notice on GST and excise since the implementation on the 8th of May, detailing which individual companies should be exempted as per the bill. “Hence for non-retail businesses, all are exempt from excise, however GST is charged,” added Tokome.

This week’s BPNG Treasury Bills auction results indicated an overall oversubscription of K503.3m from the total offer amount of K242.94m. The weighted average yield for 182 and 364 days dropped by 0.11 and 0.30% respectively to 2.00% and 3.70%. Nil offer for 273 days series.

Both the KSi Index and KSi Home Index increased by 1.3% & 0.4% to close the week at 6,261.40 points and 15,244.06 points respectively. The drive was due to increase in CCP share price.

The Porgera Chamber of Commerce and Industry president Nickson Pakea says the multi-billion-kina Porgera gold mine in Enga must reopen soon to generate economic activity to address lawlessness in the district. “The law and order issues in the district is partially due to the shutdown of the mine and those with access to guns taking advantage to conduct illegal mining activities as well as stir up trouble. “Our anticipation to receive the good news from the prime minister tomorrow (today) has been stalled due to the tribal conflict,” he said.

Retail prices of petrol, diesel, kerosene and zoom have fallen this month due to the Government’s tax exemptions on refined petroleum products, according to the Independent Consumer and Competition Commission (ICCC). ICCC Commissioner Paulus Ain said the exemption of exercise tariffs and Goods and Services Tax were applicable on petrol, diesel, kerosene and zoom sold at the retail level. “Apart from removing the applicable 10 per cent GST from all petroleum products, the applicable exercise duties of 61t/litre on petrol, 23 t/litre on diesel and 2 t/litre on zoom were all removed. The exercise duty is not applicable on kerosene.

The Government has approved the Peoples Micro Bank Limited to be a full-fledged commercial bank, State Enterprises Minister William Duma says. “This means the bank and Kumul Consolidated Holdings (KCH) can now implement venture into retail banking and commercialization of its operations,” he said. “The commercialization will result in the creation of a new commercial bank, to be known as the National Banking Corporation of PNG Limited or NBC.

VODAFONE has signed agreements with Digicel and Telikom to ensure interconnection with the two networks, National Information and Communications Technology (Nicta) chief executive officer Kila Gulo-Viu says. “Telikom and Vodafone concluded interconnection agreement this month. This a very important development in the context of competition as both subscribers from these networks can talk to each other. “Vodafone also has a separate interconnection agreement with Digicel. Vodafone customers can call and text all subscribers now, whether you are with Telikom/bmobile or Digicel,” he said.

Santos Managing Director Kevin Gallagher says the company has a high-quality portfolio of growth projects. “We will be disciplined in taking further final investment decisions, ensuring that projects like Dorado, Pikka, Narrabri, Bayu-Undan CCS, Papua LNG and others fit with our strategy and meet our commercial and economic hurdles,” Gallagher said. “This includes equity interest levels and joint venture alignment. And we will ensure they can be delivered within our capital management framework.

Bank South Pacific Financial Group Ltd has closed 3 branches in the country due to ongoing law and order issues, says group CEO Robin Fleming. He said BSP Porgera in Enga closed yesterday due to the prevailing security situation and will reopen when the safety of staff and customers was assured. The other two are hybrid branches in Koroba, Hela, and Yangoru, East Sepik. “Due to the prevailing security situation in Porgera, BSP Porgera is closed today and will reopen when the safety of BSP staff and customers can be assured,” Fleming said.

This week’s Central Bank Bills auction results indicated an overall oversubscription of K166m from the total offer amount of K629m. The weighted average yield for 28 days rose 0.04% to 1.09% while the 63 days and 91 days series dropped by 0.09 and 0.02% respectively to 1.71% and 1.80%. Nil offer for 182 days series.

This week’s BPNG Treasury Bills auction results indicated an overall oversubscription of K339m from the total offer amount of K165m. The weighted average yield for 182 and 364 days dropped by 0.06 and 0.36% respectively to 2.11% and 4.00%. Nil offer for 273 days series.

This week, the KSi Index remained unchanged at 5,867 points whereas the KSi Home Index increased by 4.7% to close at 15,188 points due to increase in CCP share price.

The PGK300m Kumul Petroleum Fabrication and Training Facility investment by Kumul Petroleum Holdings Limited is about putting down the National Content Policy into action, Managing Director Wapu Sonk says. Sonk said this during the groundbreaking ceremony near the LNG plant on the shores of Caution Bay, Central. This will be a steel, mechanical and piping module fabrication facility and construction training academy.

The Government and project developers for the PGK18.5b Wafi-Golpu project in Morobe are yet to agree on equity and royalty shares, Mineral Resource Authority managing director Jerry Garry says. Garry said that negotiations would resume this week but details of negotiations would not be disclosed until agreements were reached. “We are still waiting on a few fiscal agreements or settlements,” he said. Prime Minister James Marape had said there was no rush in getting the project off the ground, highlighting the major issue of the mine waste disposal system. Morobe prefers the terrestrial waste dam while the Government favors the deep sea tailings placement.

This year’s general election is expected to generate a modest increase in economic activity, according to Steamships Trading Company Limited. The company in its 2021 annual report stated that there was also cause for some optimism that some of the long-delayed resource extraction projects would achieve meaningful progress.

PNG’s mining exports fell from PGK15.6b in 2019 to PGK13b in 2020 due to the closure of Porgera gold mine in Enga. Mineral Resources Authority managing director Jerry Garry said exploration remained a challenge and with the 2022 General Elections, “investors are going to hold back and wait for certainty.” The average annual exports are about K11 billion,” he said.

The multi-billion Kina Porgera gold mine in Enga is yet to resume because Mineral Resources Enga (MRE) is yet to sign off on the shareholders agreement, according to the Mineral Resource Authority. Managing Director Jerry Garry said the shareholders agreement was the key agreement which needed to be signed off for the creation of the new project company for Porgera. “If there is a need to seek any variations to the SML then that can be done at that time but for now the only holdup is the signature from MRE directors.”

Santos’ value has increased by AU$6b (PGK14.8b) since its merger with Oil Search, says managing director and chief executive officer Kevin Gallagher. The company also made a PGK3.3b profit for the 2021 financial year that saw the company deliver the highest revenue, free cash flow and underlying profit in its history. With the balance sheet remaining strong, the board was able to declare a final dividend of US$8.5cents per share – a 70% increase on last years’ final dividend.

Steamships Trading Company Limited released its 2021 annual report. The company reported sales revenue on a continuing basis increased 11% to PGK563.9m against last year’s PGK506.1m, with improved revenue for Coral Sea Hotels (resulting from the requirement for international arrivals to quarantine for up to 14 days) and Consort Express Lines, which offset declines for Pacific Palms Property, East West Transport and Pacific Towing. A final dividend of 65t per share has been proposed and will be paid after the annual general meeting on June 17, 2022, subject to Steamships’ ability to secure foreign exchange for non-PNG shareholders. As there was an interim dividend paid during the year of 35t per share, the total dividend for the year is 100t per share (2020: 80t per share).

This week’s BPNG Treasury Bills auction results indicated an overall oversubscription of K262.81m from the total offer amount of K146.68m. The weighted average yield for 273 and 364 days dropped by 0.25% and 0.24% respectively to 3.5% and 4.36%. Nil offers for 63 to 182 days.

Both the KSi Index and KSi Home Index increased by 0.1% and 4.0% for the week to close at 5,867.62 points and 14,512.84 points individually. The increase was a result of BSP and CCP share price fluctuation.

Prime Minister James Marape says under the Manus Special Economic Zone project, companies operating in Manus will not pay corporate taxes to incentivize economic growth. He said this at the opening of the PGK32m Momote Airport terminal. He said the new facility needed to generate more money for the province. The terminal was funded by the Government and Asian Development Bank, and implemented by National Airports Corporation under the civil aviation development program.

Institute of National Affairs executive director Paul Barker says economic zone projects should be used in a consistent and concerted manner. “In a few countries, including China, special economic zones have been used quite effectively to revitalize disadvantaged or run down areas. In most countries, they’ve been pretty ineffective, and just become a convenient way for businesses to avoid taxes, and in some cases existing businesses to just relocate, lowering tax revenue, but generating no extra economic activity,” Barker said.

The BSP shares on the Australian Securities Exchange has shown indications of being negatively impacted by the Government’s introduced additional company tax, according to the bank. In presenting the bank’s first quarter report for 2022 financial year, CEO Robin Fleming said that BSP’s share price on PNGX finished 0.4% higher in the trailing 52 weeks at PGK12.05, with average prices of PGK12.21 last month. He said the ASX price reached an all-time high of AU$6 (about PGK14.94) after the PGK1.1 billion profit announcement, but fell after new tax’s confirmation.

Vodafone regional CEO, Pradeep Lal said PNG had low-market penetration with 37% mobile phone and 20% internet penetration, with around 1m customers actively using social media. “Vodafone PNG believe that given PNG’s low-market penetration levels, the rate of rapid change and increased reliance on digitalization and connectivity, telecommunications will remain an important industry for at least the next 100 years and one that will have a long-lasting and transformational legacy,” Lal said.

Despite the challenges of the Westpac acquisition not going ahead due to regulatory concerns, 2021 still saw Kina Securities Ltd deliver a net profit of PGK70.8m compared to PGK76.0m in 2020. This was highlighted in the company’s 2021 Financial Report released this week. Managing Director and CEO, Greg Pawson said last year, the Kina group progressed towards transforming and growing the company as it moved into year three of its current strategic planning cycle.

Locally-owned company, Lole Mining Limited, has been given a 10-year mining licence for the Tolukuma project in Central, according to the company. Founder and executive director Howard Lole said he hoped to make Lole a premier mining company in the country.

This week’s BPNG Treasury Bills auction results indicated an overall oversubscription of K338.35m from the total offer amount of K135.3m. The weighted average yield for 273 and 364 days dropped by 0.02% and 0.18% respectively to 3.75% and 4.60%. Nil offers for 63 to 182 days.

The KSi Index increased by 0.1% for the week to close at 5,862.09 points and KSi Home Index remained unchanged to close at 13,950.35 points. The increase in the KSi Index was a result of BSP share price fluctuation.

Prime Minister James Marape says it is time to seek a fresh mandate from the people as he drew the curtains close on the 10th Parliament last week. The writs for the 2022 General Elections will be issued this Thursday, April 28, setting in motion the process of electing members for the 11th Parliament. Voting is scheduled to start on June 18, and the return of writs is on July 29. Marape said the Government had so far released PGKK288m to be used for the election preparations.

Prime Minister James Marape said the Report on the Commission of Inquiry into the Union Bank of Switzerland (UBS) PGK3b loan which implicated his predecessor Peter O’Neill, had been accepted by the House and that it was “time to work”. He said that it was up to the police, Independent Commission against Corruption and the Ombudsman Commission to implement and enforce the findings. “They can pick it (report) up and go to work,” he said.

The Government was able to meet its revenue and financing targets as well as keep its expenditure under control in last year’s budget through budget repair, Treasurer Ian Ling-Stuckey says. Presenting the 2021 Final Budget Outcome last week, Ling-Stuckey highlighted that the budget deficit was kept at PGK6.3b, a reduction from the expected PGK6.6b and higher expenditure of PGK20b due to higher donor grants. Revenues generated amounted to PGK13.9 bilion from higher tax revenues and donor grants.

The Government will inject PGK611 million into the economy to address inflation as a result of the global shocks experienced due to the Russia- Ukraine war, says Treasurer Ian Ling-Stuckey. Ling-Stuckey announced in Parliament that the money would be targeted at lifting taxes, increasing the income threshold, fund school project fees and reduce the cost of selected food items starting next month.

Locally owned, Lole Mining Limited has been granted a mining lease (ML) for the Tolukuma mine in Central. The mining lease (ML 104) was presented by the Mineral Resources Authority (MRA) to the company executives yesterday. Managing director Iain MacPherson said the company would invest about US$250 million (PGK860.1m) to restart the mine. He said at the height of Tolukuma’s production, it was producing about 60,000 ounces of gold annually. “We are going to get back to that capacity over the next couple of years. But what we are really looking at in our vision is a much larger operation, very similar to Kainantu (gold mine in Eastern Highlands). “We believe maybe around 160,000 ounces or 200,000 ounces a year at some point in the future.”

The country’s third mobile operator, Vodafone PNG, will invest PGK3 bilion in the country. Regional CEO, Pradeep Lal said the telecommunications company was rolling out a 3G/4G+ network and customers would experience much faster speeds and improved customer services. “Vodafone PNG is building a brand new green field network from the ground up and constructing all new towers. “We initially had tower leasing and sharing discussions with both Digicel and Telikom/BeMobile, however no arrangements were reached, hence our decision to construct new towers.”

This month’s BPNG Treasury Bond (GIS) auction results indicated an overall oversubscription of K512m from the total offer amount of K700m. A total of K320m bids were successful in the 2yrs, 4yrs, 5yrs, 9yrs & 10yrs series. The weighted average yields for the respective series, generally dropped by 1% from the indicative yields. There was no successful bid for the 7yrs & 8yrs bond series.

This week’s BPNG Treasury Bills auction results indicated an overall oversubscription of K216.7m from the total offer amount of K98.9m. The weighted average yield for 273 and 364 days dropped by 0.01% and 0.11% respectively to 3.77% and 4.78%. Nil offers for 63 to 182 days.

The KSi Home Index decreased by 3.9% for the week to close at 13,950.35 points and KSi Index remained unchanged to close at 5,854.81 points. The decrease in the Home Index was a result of CCP share price fluctuation.

More than 1,500 State Agencies in the country have not been audited since 2013 due to insufficient funding, Auditor General Gordon Kega says. “We have over 1,500 State entities to audit and report to the parliament every year but we do not have skilled manpower and lack financial resources to audit these agencies in Port Moresby and throughout the region,” he said.

The Government’s proposal to suspend Goods and Services Tax for selected vital household items, including fuel products, to fight inflation for 6 months is inefficient and unsustainable, World Bank chief economist for Asia and the Pacific Aaditya Mattoo says. “It will have fiscal implications and affect the Government’s budget,” he said. “A more effective way would be to provide direct support to those who needed it.

The Bank of PNG released it March Monetary Policy Statement and reports that GDP is expected to rebound to 2% this year, following a contraction of 2.8% and 2.4% in the past 2 years. Inflation is forecasted at 5% this year, with the Bank forecasting inflation to ease off in the next 24 months.

The Asian Development Bank forecasts that PNG’s economy is expected to grow by 4.6% this year on the back of increased mining activities in the second half of the year. In its 2022 outlook, it stated that last year, growth in PNG, the biggest economy in the Pacific, was dampened by 2 COVID- 19 surges, underpinned by very low vaccination rates. Some relief has come from strong commodity prices and fiscal stimulus sustained by ADB and other development partners.

Over 3,000 people are expected to be employed when Porgera mine is reopened, following the signing of stakeholders’ agreements this week. The cost of restarting the Porgera mine is around US$300m, according to Barrick Niugini Ltd President and CEO Mark Bristow.

State Negotiation Team Chairman, Dairi Vele announced that the new Porgera Shareholders’ agreement establishes a new company that will own the mine. “The company will be owned by Kumul with 36%, landowners 15%, and Barrick 49%,” he said. But the country will get 53% of the benefits and Barrick 47%.

Treasurer Ian Ling-Stuckey says the Government is committed to the sale of Digicel to Telstra at the end of the month. Ling-Stuckey said this yesterday in response to speculation in the media that the additional company tax would affect the sale. He assured the public that the Government was committed to the sale going through in the expected timeframe.

Goodman Fielder PNG will begin its oil-bottling production next month at its multi-million-kina facility in Lae. National demand and supply planning manager Eranda Nanayakkara said the facility at 11-Mile would also house a rice mill, flour mill and poultry feed mill. The plant will be targeting high-quality produce as it keeps up with the high demand for wheat-based food produce.

City Pharmacy Ltd Group has declared a final dividend of 4-toea per share after recording a PGK23m profit for the 2021 financial year. CPL said in a statement that this was a 15% increase in comparison to 2020, despite increased competition, substantial surges in the cost of purchases, freight costs and COVID-19.

This week’s BPNG Treasury Bills auction results indicated an overall oversubscription of K365.5m from the total offer amount of K319.77m. The weighted average yield for 182, 273 and 364 days dropped by 0.04%, 0.17% and 0.05%. Nil offers for 63 and 91days.

This week’s Central Bank Bill overall auction was under-subscribed by K152.8m from the total K134.8m offered. The weighted average yield for 28 days decreased by 0.02% from the last auction. There were nil offers for 63, 91 and182 days.

The KSi Home Index increased by 4.0% for the week to close at 14,512.84 points and KSi Index remained unchanged to close at 5,855.34 points. The increase in Home Index was due to rise in CCP share price.

The Australian and PNG Government’s signed a PGK415m agreement under the Australian Infrastructure Financing Facility to upgrade key power and road networks across PNG. The support will include a PGK226m financing package to improve PNG’s national power infrastructure to connect more than 30,000 households, schools and clinics to electricity.

Oil Palm Industry Corporation Acting General-Secretary Kepson Pupita says the Terms of Reference for the Opic Act (1992) Review are being finalised and will be presented to Cabinet. He said Minister for Agriculture and Livestock, John Simon would present the TOR to the National Executive Council. He said this in response to a statement from PNG Palm Oil Producers Association, Chairman Robert Nilkare opposing Opic’s legislation review methodology.

The Bank of PNG released it March Monetary Policy Statement. BPNG reported that real GDP is projected to ‘pick-up in 2022 reflecting increased activity in both the mineral and non-mineral sectors’. The report noted that inflation would remain ‘elevated’, with a forecasted increase in headline CPI at 5% in 2022.

Nambawan Super Limited (NSL) will be paying a rate of 6.5% on their members’ savings, according to the superfund. Deputy chairperson Dame Meg Taylor said this was a total of PGK526 million to be paid to 208,000 members.

NSL Deputy Chairperson, Dame Meg Taylor has warned that the Market Concentration Levy to be imposed on the banking and telecommunications sectors would lead to all super fund members losing over PGK317 million in asset values and reduced dividends, in just the first year.

There is ongoing dialogue with the Bank of PNG to identify various sustainable options to ease foreign currency challenges, Puma Energy PNG country manager Hulala Tokome says. Tokome was commenting on Prime Minister James Marape’s statement last week that there was about PGK10.3b in foreign reserves at BPNG. Marape told Parliament that the level of foreign currency available in the Central bank was enough for companies to do their overseas purchases.

K92 MINING Inc in Kainantu has a record cash balance of PGK250 million and no debt and is well positioned to fund its growth and exploration, Chief Executive Officer John Lewins says. In its recently released 2021 financial year report, Lewins said 2021 represented another major step forward for the miner.

PGK200m is spent annually to import chicken, a locally-owned poultry business says. Mandekem Ltd Managing Director Timothy Numilengi said this clearly showed that there was huge market demand for the product in the country. “The import bill for uncooked chicken meat is about PGK200 million every year,” he said.

This week’s BPNG Treasury Bills auction results indicated an overall oversubscription of K200.8m from the total offer amount of K308.41m. The weighted average yield for 364 days dropped by 0.02% whereas 273 days remained unchanged from the last auction. Nil offers for 63, 91 and 182 days.

Both the KSi Home Index and KSi Index remained unchanged for the week to close at 13,950.35 and 5,853.76 points respectively.

The Government is holding consultations with companies affected by the “market concentration levy”, Treasurer Ian Ling-Stuckey says. “The levy was introduced as a revenue-raising measure in Budget 2022. The discussions have been with the three major companies likely affected by the proposed new tax – BSP, Digicel and Telstra,” he added.

The Acting Secretary for Foreign Affairs Elias Wohengu says that the PNG’s foreign missions around the world have carried over debts for 7 years which add up to PGK55m. “The Government has paid PGK24.2m with another PGK15m to be raised by Treasury,” Wohengu said.

Prime Minister James Marape says he will instruct Treasury to assist one of PNG’s biggest fuel suppliers to have better access to foreign exchange in order to maintain a consistent supply of fuel. Marape said there was around US$3b (about PGK10.3b) in foreign reserves available at the Bank of PNG, which companies could use to do overseas purchases. “On the issue of forex, BPNG has more foreign reserve in our bank. Today we have about US$3 billion sitting in our foreign reserve,” he said.

Prime Minister James Marape says consideration will be given to the agriculture sector to help with relief support. He was responding to a question from East Sepik Governor Allan Bird in Parliament yesterday on the cost of agriculture items like fertilisers that has recently increased. “Russia and Ukraine are major producers of fertilisers and as a result of the war, the price of fertilizer has increased from about PGK2,500 per tonne to PGK6,000,” Bird said.

The increase in levy on green bean coffee exports from 10t to 20t per kilogram is reasonable, Coffee Industry Corporation Ltd Board Chairman Jerry Kapka says. “The increase is not same as 10t administrative levy. With the current scenario facing the coffee industry, the board has seen the need to have a reserved funding source assigned specifically for coffee development initiatives, including quality improvement and market accessibility,” Kapka said in a paid notice.

Bank of Papua New Guinea (BPNG) will launch a credit guarantee corporation to help grow PNG’s small to medium enterprise (SME) sector, an official says. BPNG accelerator programme manager Dominic Sikakau said in Port Moresby yesterday: “We are looking to launch through this programme a credit guarantee corporation. It will be a company set up by BPNG, 60% owned by BPNG and 40% by the Government basically to provide guarantees to SMEs who have vital businesses but lack the important collateral that commercial banks require.”

The Independent Consumer and Competition Commission (ICCC) says it has revoked its authorisation granted to Link PNG to give effect to the proposed codeshare arrangement with PNG Air last October. ICCC in a statement said the proposed codeshare arrangement was both passenger and freight services and particularly for the domestic routes.

This week’s BPNG Treasury Bills auction results indicated an overall oversubscription of K338.37m from the total offer amount of K348.8m. The weighted average yield for 28 and 91 days dropped by 0.02% and 0.03% whereas 273 days remained unchanged from the last auction. Nil offers for 63 and 91 days.

This week’s Central Bank Bill overall auction was under-subscribed by K55.1m from the total K354.1m offered. The weighted average yield for 28, 63 days and 91 days increased by 0.01%, 0.01% and 0.05% respectively from the last auction. There were nil offers for 182 days.

Both the KSi Home Index and KSi Index remained unchanged for the week to close at 13,950.35 and 5,853.76 points respectively.

World Bank has predicted high inflation as a consequence of the war between Russia and Ukraine. Ruslan Piontkivsky, World Bank Country Economist for PNG, said “We have some indication of the direction it will take but we will know in the coming weeks and months of the full impacts. In the short term, there will be a boost on the external side on high export proceeds and this will help those in the external sector in their production.”

Puma Energy Country Manager Hulala Tokome said the company would limit their fuel supply to retail, aviation and commercial customers due to the lack of access to Foreign Currency to enable them to import crude oil.

Petroleum Minister Kerenga Kua says PGK120m in outstanding capped Memorandum of Agreement (MoA) funding for PNG LNG project landowners will be released as soon as Treasury releases the money. He said the National Executive Council had already approved the release of the money and the payment needed to be settled.

City Pharmacy CEO Navin Raju says the prices of locally-produced goods are being affected by the cost of importing raw materials. “There are delays in the shipment of these raw materials, and the freight costs have gone up. So all these price pressures are actually increasing the cost of production for the producers.”

The country is experiencing ongoing issues of foreign currency shortage because revenues from exports are being kept in offshore accounts, a business representative says. PNG Manufacturers Council CEO Chey Scovell said oil prices were at record highs and the State’s revenue and all the project partners’ revenues in the PNG LNG project was at record levels and none of that money was coming back into the country. He said it was crucial that the Government required its earnings from future projects be brought in and kept in country.

PNG Spice Industry Board CEO Nelson Simbiken says the country’s vanilla exports are worth almost PGK300m annually. Simbiken said vanilla alone accounted for 99% or PGK297m of the country’s spice revenue. He said the country was currently the fourth largest supplier of vanilla to the world market and produces around 50 tons of vanilla annually.

Kina Asset Management Ltd recorded a 2021 net profit of PGK6m, according to Chairman Sir Rabbie Namaliu. Sir Rabbie said KAML’s net profit was driven by an investment return of 8.3% with share markets in most countries rising in response to an improving outlook for the global economy. He said unrealised capital gains on KAML’s shareholdings for the year totalled PGK6m before the impact of foreign exchange movements.

PNG’s economic growth can be mirrored by the performance and innovation of its leading digital bank, Kina Bank, says CEO Greg Pawson. Pawson was speaking following a 2021 profit growth of 27% (net profit). “At the same time, as innovating and delivering a better banking solution for PNG, we believe we are helping the economy grow through lending for business and individuals and providing a better banking experience to more people in the country,” he said. Following its 2021 results, Kina Bank is now the second biggest bank by lending in PNG

This week’s BPNG Treasury Bills auction results indicated an overall oversubscription of K228.67m from the total offer amount of K210.45m. The weighted average yield for series 182, 273 and 364 days fell by 0.04%, 0.05% and 0.03% to end at 2.32%, 3.92% and 5.13% respectively. Nil offers for 63 and 91 days.

The KSi Home Index decrease by 0.4% for the week to end at 13,894.11 points due to drop in CCP share price. KSi Index increased by 0.1% for the week to close at 5,875.20 points due to rise in BSP share price.

Treasury may provide a subsidy to cater for inflation if effects are felt of the Ukraine-Russia conflict, says Prime Minister Marape. He said the PNG economy was import-dependent with about 80% of goods, including fuel being imported. “We are working closely with the major fuel importers to see how best we can minimize the effects of inflation,” he said. 

Ialibu-Pangia MP Peter O’Neill is concerned about the management of the economy, following the release of an economic update by the Government last week. He said it was strange that the International Monetary Fund had not released any analysis since early 2020 when the Government borrowed nearly PGK1.0b. 

Treasurer Ian Ling-Stuckey has blamed the increase in the cost of goods and services to the disruptions in the supply chain worldwide. He said the Government was working hard to minimize the impacts at home ‘but supply chain uncertainty will only get worse this year’. “While we are still awaiting the final numbers, PNG Treasury analysis for the budget suggests that we saw average price rises of around 5% in 2021”, he said.

PNG’s State Negotiation Team Chairman, Dairi Vele, is confident Porgera gold mine will reopen in April this year. He stated: “Kumul Minerals, Barrick and the State are working really hard so we are very confident that come April, Porgera will be re-opened.”

PNG Power (PPL) has management and legacy issues but is “not that broke”, says State Enterprises Minister William Duma, as NEC approves PGK100m to assist the electricity provider. The money will be used to settle PPL’s debts to service providers and independent power producers.

PNG Power (PPL) will owe NiuPower PGK200m if it fails to pay its debts this month, says NiuPower CEO, Michael Uiari. Uiari said NiuPower would face difficulties in its business operations, which included power supply support to the N.C.D and Central. “If the situation cannot get better and PPL does not retire its debt, NiuPower will not be in a position to pay the gas supplier (PNG LNG) by September,” he said.

The Japanese government has provided a PGK15.6m grant for work on the Rouna 3 hydropower station in Central. The Japanese Ambassador, Nobuyuki Watanabe said the grant was for the procurement of electrical equipment to enhance generation at the Rouna 3 hydropower station.

Credit Corporation (CCP) is entering 2022 in good shape, according to CEO Danny Robinson. This week he announced that CCP will be applying for a commercial banking license this year. “We would definitely look to have the banking license in place by the end of 2022”, he said.

Kina Securities announced a net profit of PGK96.2m, an increase of 27%, with a statutory net profit of PGK70.8m for the 2021 financial year. According to the bank, the statutory results were impacted by one-off costs associated with the termination of the Westpac acquisition.

Steamships Trading Company announced an improved financial performance for the year ended 2021, on the back of a strong performance in the hospitality division and a continued recovery in the shipping division. The company declared a final dividend of PGK1 per share, up 25% from the prior year.

This week’s BPNG Treasury Bills auction results indicated an overall oversubscription of K256.1m from the total offer amount of K278.0m. The weighted average yield for series 182, 273 and 364 days fell by 0.05%, 0.01% and 0.01% to end at 2.36%, 3.97% and 5.16% respectively. Nil offers for 63 and 91 days.

The KSi Home Index increase by 0.2% for the week to end at 5,868.76 points due to rise in BSP & KSL share price. KSi Index remained unchanged for the week to close at 13,950.35 points.

The P’Nyang LNG project in Western will be worth US$44 billion (about PGK151.1 billion) upon completion, says Prime Minister James Marape, following the signing of the P’Nyang Gas Agreement between the State and ExxonMobil with its affiliate partners. 

Australia will print and pay PGK10 million for the 12 million ballot papers to be used in the 2022 general elections, according to Electoral Commissioner Simon Sinai. In addition, India will provide, and pay PGK5 million for, the indelible ink used during polling, he said.

The Prime Minister announced that the construction phase for the P’nyang LNG project would begin after completion of the Papua LNG construction phase around 2028, and earnings from the project will start flowing in around 2033. The Government secured a 34.5% equity share.

The Internal Revenue Commission collected PGK9.6 billion last year, exceeding the target by 4% (PGK375 million), Commissioner-General Sam Koim says. This was largely due to major increases in Mining & Petroleum Taxes; Salaries & Wages Taxes and GST.

Petroleum Minister Kerenga Kua says the US$10billion (PGK35.1billion) Papua LNG is on track for a final investment decision next year and construction to begin in 2028, following discussions with operator Total.

The State is hopeful it will finalize agreements for the US$5.4 billion (PGK18.5 billion) Wafi-Golpu mining project in Morobe in the first quarter of the year, Mineral Resources Authority managing director Jerry Garry says. “The state has a National Executive Council decision at 8% and the company is saying no and is offering 3.5%, so that’s where the negotiations are.”

State Enterprises Minister William Duma says independent power producer (IPP) rates are still high and there is room to negotiate for a better deal for PNG Power Limited. “I understand that monthly payments for one IPP can cost PPL PGK14 million”. The current IPPs are PNG Forest Products Hydro, NiuPower, Dirio Power, New Britain Oil Palm, Posco and Edevu Hydro (PNG Hydro Developments).

Gold miner St Barbara withdrew its production outlook for fiscal 2022, citing a COVID-19 Omicron outbreak at its Simberi operations that has affected its workforce. The company narrowed its 2022 production guidance to between 305,000 and 335,000oz from an earlier range of 305,000 to 355,000oz.

This week’s BPNG Treasury Bills auction results indicated an overall oversubscription of K320.64 m from the total offer amount of K224.75m. The weighted average yield for 182 fell 0.02% to end at 2.41%, while 273 remained unchanged at 3.98%. The 364 days series rose 0.01% to close at 5.17%, compared to last weeks’ auction. Nil offers for 63 and 91 days.

The KSi Home Index increase by 0.1% for the week to end at 5,859.18 points due to rise in BSP share price. KSi Index remained unchanged for the week to close at 13,950.35 points.

Prime Minister Hon. James Marape this week announced that NEC has cleared the P’nyang Gas Agreement, which now awaits signing between the State and lead project developer, ExxonMobil.

The Prime Minister’s statement indicated that the total state equity in the P’nyang project would be 34.5% - which is above the 22.5% allowed by the Oil and Gas Act. ExxonMobil is expected to offload 12% of their stake at fair market price to PNG parties, of which the Prime Minister has committed to “offload most to Western Province and Landowners.”

The Covid-19 National Control Centre is proposing that all frontline workers in the coming General Elections must be fully vaccinated, Deputy Controller Dr Daoni Esorom says. Frontline workers include police, defence force, polling officials and anyone who would be working with Electoral Commission.

The Government of Australia this week released details of its latest loan agreement with PNG, which was drawn down in December 2021 to provide support to PNG’s 2021 Fiscal Budget. The total loan amount was A$650million, with the base interest rate set at the 10-year Australian Government bond rate, being 1.645%. 

Inflation remains a concern in Papua New Guinea, especially with the rise in the Covid-19 Delta variant cases, and the emergence of the Omicron variant across the globe and its spill over effects on domestic prices, Bank of Papua New Guinea acting Governor Benny Popoitai says.

Landowners from the Bougainville Copper mine area and the Autonomous Bougainville Government signed a joint resolution last Friday to re-open the mine, causing a leap in its share price. The ABG currently holds a 36.4% shareholding.

A fisheries hub will be constructed in Vanimo, West Sepik, to support and grow the sector in the province, according to the National Fisheries Authority. NFA, in partnership with the West Sepik provincial government will co-fund the project to build the hub which will cost PGK25million.

Construction work on the PGK6 million Wabag Food Depot in Enga started last week, Wabag MP Dr Lino Tom said. “The food depot will include cooling and refrigerating facilities that will be used to store fresh fruits and vegetables plus sweet potatoes, English potatoes, bananas and other food varieties and meat products,” he said.

Santos says it is targeting US$2 billion (about PGK6.84 billion) to US$3 billion (about K10.2 billion) in asset sale proceeds as a means of strengthening its balance sheet this year. The Australian operator recorded free cash flow of US$1.5 billion (about K5.13 billion) and underlying profit of US$946 million (about K3.23 billion) last year.

K92 Mining Ltd can be operational for more than 30 years, its CEO John Lewins says. He said the current resource had more than five million ounces of gold. “The current mine life is more than 10 years with the expansion to 350,000ozs per annum. “With continuing exploration success, we believe that the mine can be around for more than 30 years.

This week’s BPNG Treasury Bills auction results indicated an overall oversubscription of K320.64 m from the total offer amount of K224.75m. The weighted average yields for 182, 273 and 364 days all dropped by 0.06%, 0.03% and 0.04% to end at 2.43%, 3.98% and 5.16% respectively, compared to the last auction. Nil offers for 63 and 91 days.

Both the KSi Home Index and KSi Index remained unchanged for the week to close at 13,950.35 and 5,852.10 points respectively.

The State Funeral for Late Sam Akoitai, Open Member for Central Bougainville, will be held on Wednesday, 5th January 2022, as announced by the Bougainville Regional Member, Peter Tsiamalili this week. 

Police Commissioner David Manning has received reports of Papua New Guineans allegedly training with Solomon Islanders to overthrow the Government of Prime Minister Manasseh Sogavare in the New Year.

The Commander of the PNG Defence Force, Major General Gilbert Toropo, whose position was revoked recently by the National Executive Council, is seeking to challenge the decision of his revocation in Court.

The Investment Promotion Authority remained resilient to maintain and attract investments during the year, says Chairman Leon Buskens. Buskens said that proposed foreign investment was well over PGK1.3 billion, with proposed jobs more than 3,000 – more than 80% of which are held by locals.

PNG Customs collected about PGK3.13 billion against the revised budget projection of PGK3.14 billion, says Commissioner David Towe. Towe said this was about 99.67 per cent of the revenue. “Our Waigani Public Accounts transfer has already exceeded the projection of PGK2.01 billion by PGK24.4 million (101 per cent),” Towe said.

The Government will soon invite private sector investors to invest in Telikom Ltd under a government partial private partnership programme, according to National Superannuation Fund (Nasfund) CEO, Ian Tarutia.

OK Tedi Mining Ltd (OTML) has declared a final dividend of PGK300 million – paid last week to its shareholders, bringing total dividends this year to PGK450 million. OTML chairman Dr Roger Higgins said despite a two-week suspension of operations in March this year and ongoing labour shortages due to Covid-19, the company benefitted from a strong final quarter production and favourable metal prices.

The EU-Streit PNG Program has entered into a partnership with MiBank to provide financial services to cocoa farmers in East Sepik province. The services under the EU-Streit program scheme will range from access to finance, rural banking and cashless payments for the farmers to access.

PNG must brace for increases in non-tax (non-Internal Revenue Commission and Customs) fees and charges by government departments and agencies next year, an official says. Farmers and Settlers Association president Wilson Thompson said the various fees related to agriculture, food processing, rural business and exports would affect costs of production and prices paid to growers.

Government should address under-performing State-owned enterprises by assessing them at a case-by-case basis, according to Micro-Small- Medium-Enterprise Council president Des Yaninen. He said that an entity should not be a regulator and a services provider at the same time, using PNG Power Ltd as an example.

This week’s BPNG Treasury Bills auction results indicated an overall oversubscription of K284.0m from the total offer amount of K325.12m. The weighted average yields for 182, 273 and 364 days all dropped by 0.03%, 0.06% and 0.13% to end at 4.29%, 5.95% and 7.04% respectively, compared to the last auction. Nil offers for 63 and 91 days.

Both the KSi Home Index and KSi Index remained unchanged for the week to close at 14,391.40 and 5,861.53 points respectively.

The Internal Revenue Commission (IRC) presented a cheque for PGK200 million to the Government last week. The amount exceeded IRC’s original revenue target for this year amid subdued economic conditions. Prime Minister Marape said IRC had transferred PGK8.3 billion, exceeding the original target of PGK8.1 billion.

Treasury Secretary Dairi Vele has confirmed that he will become the chairman of the State negotiating team. Vele said: “The Marape government is reviewing how we are represented on the world stage, decided to establish a full-time chairman role for major national projects in mining, petroleum and other large foreign investments. I am privileged to accept this position.”

The government policy on the single exporter concept for commodities such as cocoa and coffee will be completed next year, an official says. Agriculture and Livestock Department acting secretary Stephen Mombi said the policy would ensure that world prices of commodities was felt by farmers.

The smooth transitioning of the merger arrangement between Oil Search Ltd and Santos Ltd has demonstrated an independent and vibrant regulatory environment, according to PNG Extractive Industries Transparency Initiative head, Lucas Alkan. He said the smooth transitioning indicated that businesses could operate free of undue control and influence.

Cocoa samples from Bougainville have been recognised as one of the world’s best after winning gold at the 2021 Cocoa of Excellence awards ceremony in Rome, Italy. Samples from Bougainville were grown through a research project supported by the Australian Centre for International Agricultural Research (Aciar), as part of the PNG-Australia Partnership.

Oil palm small-holder farmers generate on average between PGK450 million to PGK500 million annually on fresh fruit bunch sales but there is potential for more, according to the Oil Palm Industry Corporation (Opic).

“The smallholder farmers have the potential to generate on average PGK500 million to PGK1.5 billion annually in sales which is an average of 17 to 20 tons (yield) per hectare per year,” said Opic.

The informal small-to-medium enterprise (SME) sector in the country is worth around PGK15 billion, says Yangoru-Saussia MP Richard Maru. “The sector is worth about K15 billion in terms of sale, production and revenue.” Maru said PNG could reach 500,000 if the Government recognised the importance of the sector and the potential of the people to be successful.

This week’s BPNG Treasury Bills auction results indicated an overall oversubscription of K399m from the total offer amount of K331.79m. The weighted average yields fell across all terms for 182, 273 and 364 days to 4.32%, 6.01% and 7.17% respectively, compared to the last auction. There were no offers for the terms 63 and 91 days.

The KSi index and the Home Index remained unchanged at 5,861 and 14,391 points for the week.

• The Australian government has pledged to pay for tuition fees for about 1.1 million primary school students across PNG. During the third PNG-Australia Leaders’ Dialogue, the Prime Minister for Australia, Scott Morrison stated that his government has budgeted AUD$35 million in its ‘Sector Budget Support’ to assist PNG government with its tuition fee-free subsidy program next year.
• More than PGK500 million was paid as dividend by Kumul Petroleum Holdings Ltd to the State this week. From that, more than PGK250 million was announced as dividend payment for the landowners and five provincial governments within the PNG LNG project impact areas. This was from the Kroton equity that the 60,000 landowners and their provincial governments have shares in.
• Bank South Pacific Financial Group Ltd (BSP) has acknowledged that it failed to conduct effective enhanced customer due diligence reviews and that there were compliance gaps in its anti-money laundering (AML) and counter terrorist financing (CTF) program. The bank said it remained committed to working with Fasu to further improve and uplift its AML/CTF initiatives and comply with AML/CTF laws.
• The Asian Development Bank (ADB) has approved a US$150 million (PGK542 million) loan to improve State-owned enterprises (SOE) in the country. ADB’s Pacific Office representative, Pamela Wyatt said the ADB had long been engaged in PNG’s SOE reforms. “The program is expected to reduce unsustainable borrowing practices, improve accountability and transparency, and encourage private sector participation.”
• PNG coffee is one of the best in the world and has the potential to enter the United Arab Emirates (UAE) market, an official says. Coffee Podium managing director Brandon Mawanda made the remark during the PNG investment forum at the World Expo in Dubai. Mawanda said a key issue that needed to be considered was the ability for the coffee to gain the trust and build its reputation in the market.
• Harmony Gold in Morobe has announced that it will resume a drilling programme at its Kerimenge prospect EL 497 in Wau next year. The announcement was made during a reconciliation ceremony with the Kwembu villagers of the Biangai tribe after Harmony left the site eight years ago. Naguwean said the company agreed to resume drilling and move to the advanced stage of exploration of Greenfield to Brownfield.
• Santos Ltd is now the biggest partner in the PNG LNG project with over 40% stake, according to Securities Commission of Papua New Guinea (SCPNG). Acting Executive Chairman SCPNG Robert Minak said with all of Oil Search’s oil and gas fields in PNG now under Santos, there was the possibility of capital creation for PNG investors.
• Australia’s Santos Ltd has demonstrated its confidence in the Papua New Guinea capital market through its listing on the PNG National Stock Exchange (PNGX), according to the Securities Commission of Papua New Guinea (SCPNG). The SCPNG welcomed the inauguration of Santos (STO) as the newest member of PNGX, noting its merger with Oil Search, which became effective this month. The company listed on PNGX and its shares began trading this week as a foreign exempt company.
• This week’s BPNG Treasury Bills auction results indicated an overall undersubscription of K59.83m from the total offer amount of K267.8m. The weighted average yields for 182 increased by 0.01% to end at 4.34% while 273 and 364 days remained unchanged at 6.03% and 7.20% respectively, compared to the last auction. Nil offers for 63 and 91 days.
• Both the KSi Index and KSi Home Index remained unchanged for the week to end at 5,862.15 and 14,391.40 points respectively.

Former Prime Minister Peter O’Neill says the Government’s more than PGK22 billion budget for next year, which is historically, a large size budget appropriation is ‘was unrealistic’.  He pointed to the Government’s push to drive up personal income tax revenue, which would be very challenging in the current challenging economic climate.  “Let us estimate a lower number.  In addition, if we collect more, that is even better.  But let us be realistic about the level of tax that are due to the nation,” he said.

Port Moresby will not see a lockdown, says NCD Governor Powes Parkop.  He says this decision was made after discussions were held with key stakeholders in the city and the National Government Governor Parkop says, “Instead, we will focus on maintaining and upgrading the 3 long approaches we are currently pursuing to respond to the 3rd wave of the COVID-19”

Oil Search shareholders have unanimously voted in favour of the company’s merger with Santos.  Oil Search announced this in a statement after its shareholders participated in a meeting (this week).  "Oil Search Ltd is pleased to announce that the proposed merger with Santos Ltd was approved by the requisite majority of Oil Search shareholders at the scheme meeting held (this week)," the company said in the statement.  "Under the arrangement, Santos will acquire all of the shares in Oil Search in return for the issue of new Santos shares to Oil Search shareholders."

PNG Ports Corporation Ltd (PNG Ports) will spend US$120m (about PGK412.9m) on the extension of the berthing at the Lae main wharf.  Managing director Fego Kiniafa said this would be from the Australian government is funding support of US$435m (about PGK1.5b).

The IRC has taken on board the use of SMS to small business taxpayers.  "We are progressing to the path of one day becoming paperless," it said.
"Our latest drive is to use the mobile phones to communicate with taxpayers.  The IRC has started using SMS messaging to contact registered small business taxpayers who do not have access to emails."

The PNG Property Developers Association was launched this week in Port Moresby.  This new peak body was established to better represent the combined voice of major PNG Property developers and investor in the country.  The association will seek to work closely with regulatory and statutory authorities to promote the improvement in the standard and quality of properties built in PNG and also to advocate for industry members to uphold and abide by building regulations and codes.

This week’s BPNG Treasury Bills auction results indicated an overall oversubscription of K94.7m from the total offer amount of K300.24m.  The weighted average yields for, 182 and 273 fell to 4.33% and 6.03% respectively, compared to the last auction while the 364 days remained unchanged at 7.20%.  There were no offers from 63 and 91 days.

The KSi Home Index dropped by 0.5% to close at 14,391.40 points for the week.  The decrease was due to a decrease in the shre price of Credit Corporation (CCP).  The KSi Index rose 0.3% for the week to close at 5,860.08 points.

• After years of hardship, disputes and court battles, Central Province is now entitled by law to 10% of the NCDC’s Goods & Services Tax (GST) revenue. In tabling the Bill to introduce the new GST measures, Central Province Governor Robert Agarobe also announced that the proposed amendments would also change the NCDC’s Governance structure, which now means Governor Agarobe is now part of the NCDC Board.
• Treasurer Ian Ling-Stuckey says strict limits have been set for the Bank of Papua New Guinea (BPNG) when it comes to financing the Government. He said this following the passage of the Central Banking (Amendment) Bill 2021 in Parliament (this week). With the changes, Ling- Stuckey said BPNG had its legislative framework “modernised and strengthened”.
• The collection of GST is expected to increase by more than 20% as per the 2022 National Budget figures, PricewaterhouseCoopers tax partner Peter Burnie says. “When we looked at the Budget this year, and when we talk about how the overall economic increases can the tax make, the number of GST is the single largest that is looking to be collected between 2021 and 2022,” he said. “The amount of GST to be collected will increase by 22% from 2021 to 2022”.
• Former Chief Secretary Isaac Lupari has called on the Petroleum Minister Kerenga Kua to clarify the status of the P’nyang PRL 3. “The P’nyang PRL3 expired 5 years ago, and to date, the Government though the Petroleum Advisory Board (PAB) has not made any decision”. Mr Lupari said that the people of Western Province and the country have the right to know the status of the P’nyang PRL3, and the legal basis for the Heads of Agreement and any negotiations with Exxonmobil.
• Puma Energy PNG Ltd.’s Napa Napa refinery is at risk of closure by the end of this month, says Country Manager Hulala Tokome. Tokome said that this would be a result of the Government’s proposed customs tariff on imported refined fuel products. The proposed changes will see a 5-toea reduction tariff for refined diesel and petrol, which the Government says, will encourage competition in fuel industry. Tokome said the closure of the refinery would affect 150 jobs and major losses in taxes to the state.
• This week’s BPNG Treasury Bills auction results indicated an overall undersubscription of K51.39m from the total offer amount of K302.25m. The weighted average yields for 182 and 364 days remained unchanged at 4.34% and 7.20% respectively except the 273 days series which dropped 0.1% to 6.03% from 6.04%.
• This week’s Central Bank Bills overall auction oversubscribed by K93.10m from the total K153.0m offered. The weighted average yield for 28 was unchanged at 1.29% except for the 91 days, which fell 0.01% to 1.97% from 1.98%. There were no offers for the 63 and 91 days series.
• Both the KSI main index and Home index remained unchanged over the week at 5,846.50 and 14,456.59 respectively.

• The Department of Agriculture & Livestock (DAL) Acting Secretary, Stephen Mombi said the department’s policy division has started work on an agriculture price support policy for the Agriculture Administration Adjustment Bill and Agriculture Investment Corporation Bill. They have also commenced review of the long-term agriculture sector plan that expired five years ago. DAL is currently working in consultation with the respective stakeholders with agriculture backgrounds to finalize the two policies before informing the Parliament. 
• The Lands Department Deputy Secretary of Customary Lands, Mr Lazarus Malesa spoke about the Department’s plan to address the need for affordable housing for public servants.  He referred to the planned housing project in Gerehu, on a vacant State land that did not eventuate. The department is considering utilizing customary land for this project and are currently working with various development partners to build affordable homes for public servants. The cost of customary land development is notably higher as some developers tend to increase cost on already built properties. Therefore, negotiations are currently underway with customary landowners in determining the final purchase price before commencement.  
• PNG citizens living in China & Philippines (mostly students) are experiencing difficulty accessing their funds using their BSP visa debit cards. BFL withdrew its services in those Countries as a result of Anti-Money Laundering regulation by the Central Bank of PNG. BFL Group CEO, Robin Fleming said as part of the Banks’ transaction monitoring process, the Bank’s ATM cards have been limited to allow revalidation process with customers using ATMs in those countries to verify activity is consistent with our know your customers profile. The Bank will continue to the monitor usage if its visa cards offshore to ensure customer funds are being protected.
• Oil Search Limited (OSH) confirmed that PNG Government and Esso PNG P’nyang Limited operator of PRL3 mutually announced their plan to re-engage in the negotiations on the P’nyang project. Diego Fettweis from OSH, Australia stated that this is a positive step towards the development of P’nyang. Chairmen of Esso PNG P’nyang Limited and Managing Director of Exxon Mobil PNG Peter Larden, together with their other joint venture partners are looking forward to working closely with the PNG Government and Landowners to progress the P’nyang field development proposal to secure the license needed to proceed. The project has an 8-year life span that is expected to be a substantial boost to the economy and the country.
• Kina Securities Limited (KSL) announced a NPAT of K39.8m for 2021 HY, 36.0% increase from the prior corresponding period. Revenue of K155.7m, capital adequacy ratio of 23.3%, earnings per share PGK 13.9 toea (AUD 5.1 cents), return on equity 13.9% and net interest margin 7.0% were amongst its strong performances. An increase in transactional volumes, continued cost discipline and growth in the existing loan book, supported by KSL’s sharpened focus on re-shaping the customer experience and the continued delivery of innovative products and services were main drivers of the company’s profit. KSL declared an unfranked interim dividend of K0.825 per share (AUD 0.300 cents per share). Ex-date is 01/09/2021, payment date is 01/10/2021. 
• This week’s BPNG Treasury Bills auction was undersubscribed from the total offer amount of K436.6m by K81.5m. The weighted average yields for, 182, 273 and 364 days remained unchanged at 4.35%, 6.04%  and 7.20% respectively, compared to the last auction. Nil offers for 63 and 91 days.
• The KSi Index fell by 0.2% to close at 5,847.82 points for the week. The decrease was due to drop in share price of financial stock (BFL). The KSi Home Index remained unchanged for the week to close at 13,931.40 points.

• Treasurer, Ian Ling-Stuckey presented the government’s covid-19 ERP response on expenditure through issuance of the covid bonds worth K2.5 billion and concessional loans adding up to K2.8 billion. The Treasurer explained that rather than cut expenditure, they were able to protect the budget. K214 million was utilized to fund provincial and district Covid-19 programs which included MSME and SME support while the remainder of the funds went to supporting all programs part of the Budget.
• The Nambawan Super Limited (NSL) clarified its’ plans to move to the 9-mile land was not for development purpose but to look for options with responsible stakeholders of either land swapping or relocation of squatters on their land. The Fund has appointed a project manager to sat up a camp at 9-mile land (Bushwara) to conduct a face to face engagement with squatters, NCDC and the State about the next phase. The camp will also provide squatters easy access to NSL representatives and accurate information onsite about the relocation process. 
• Average income earners living in Goroka and Kainantu have raised concerns about the continuous spike in prices of goods in the shops. The Eastern Highlands Governor, Peter Numu urged the Independent Consumer and Completion Commission to consider a branch set up in the Province to closely monitor and regulate the prices of goods to address the issues.
• The NSL Rangeview Plaza development at Waigani is almost complete and will be set for trading early next year. Chief Investment Officer Mr David Kitchnogue is confident that project is ahead of time and ahead of budget. The Plaza offers an alternative shopping Centre will compete directly to the Vision City Mega Hall.  
• Newcrest Mining declared a USD40 cents final dividend, payable to its shareholders on 30 September 2021. This is a result of the Company’s FY’21 financial performance ended 30 June 2021 which reported an increase in NPAT of +17% (K4.6m) compared to FY’20.  The Dividend Reinvestment Plan (‘DRP’) remains available and will be offered to shareholders at a price determined by the volume weighted average price of shares traded on the ASX over the period 31 August 2021 to 6 September 2021. No discount applies to the DRP. Shareholders have until 5pm AEST on 30 August 2021 to change their DRP election for the final dividend.
• BSP Financial Group declared a 39 toea interim dividend, payable to its shareholders on 18 October 2021. This was a result of the Groups sound financial performance for the HY’21 ended 30 June 2021 which reported an increase in NPAT of +17.6% (K449.3m) compared to HY’20.  BSP Group Chairman, Sir Kostas Constantinou said the positive outcome was enhanced as a result of the eased pandemic domestic restrictions and improved liquidity levels in PNG and offshore.      
• This week’s BPNG’s Treasury Bill auction subscriptions exceeded the total offer amount of K217m by K61.8m. The weighted average yields for, 273 and 364 days remained unchanged at 6.04% and 7.20% respectively, except for the 182 days which increased slightly to 4.35%, compared to the last auction. Nil offers for 63 and 91 days.
• This week’s Central Bank Bills overall auction was over-subscribed by K68.0m from the total K50m offered. The weighted average yield for 28 was 1.32%. There were nil offers for 63, 91 and 182 days
• The KSi Index rose by 0.3% to close at 5,860.06 points for the week. The increase was due to rise in share price of financial stock (BFL). The KSi Home Index remained unchanged for the week to close at 13,931.40 points

Despite Autonomous Region of Bougainville urging the National Government to grant its political independence by 2027. Prime Minister (PM) James Marape told the Parliament that both governments will work through the established process and their results will determine political future of Bougainville. PM will make a ministerial statement early next week to update the nation on the results of the Wabag and Kokopo meetings on Bougainville.

According to a Statement by Transparency International PNG (TIPNG). A report from the Auditor General’s office indicated that a majority of the State Bodies have violated the Public Finance Management Amended Act 2016 (i.e section 63 provision on Reports and Financial Statements) by failing to submit their Annual Financial Statements on time.  TIPNG urges all responsible members of the Parliament and Department of Finance to support the Auditor General’s office for timely submission of public audit reports in Parliament. 

The 174 clans in Hela Province affected by the PNG LNG project will receive K3.76m from the State, which is 40% of total royalty and equity benefits available to them in accordance with the Oil & Gas Act. K1.5m will be received in the form of equity from 2014 – 2016 while K2.2m will be received in cash as royalty from 2014 – 2018. MRDC Director, Mr Augustine Mano said the payment was announced following the successful completion of bank account openings for each benefiting clan and appointment of their respective representative directors.

East New Britain Provincial Health Authority (ENBPHA) announced their signed partnership deal with PNG DtaCo Ltd as their internet and ICT service provider into the Nonga General Hospital in ENB. Chief Executive Officer, Mr Paul Komboi of the ENBPHA said in his announcement that this was an achievement under the Hospitals Community service obligation program to provide improve ICT experience through the Fibre Optic Cable network and the upcoming digital platform, the Cloud.  

The Bank of PNG reported the decline in local economic activities in 2020, despite the recovery in December quarter. This was mostly due to the adverse impact of Covid-19 on the Global economy that affected business earnings (minimal business activities and employment cuts), production of mineral and non-mineral commodities and the headline inflation rate (remained elevated). Cross currency, effect on the PNG Kina also resulted in the declined trade weighted index. Economic data in the second half of this year indicated an improvement in employment levels following the gradual uplift in Covid-19 state of emergency measures. 

The PNG Chamber of Mines and Petroleum appointed Mr Antony Samre as President of the Chamber. He took over from Mr. Richard Kassman who is now the Senior Vice President focusing on the Papua LNG project. 

PNG Securities Commission acting Executive Chairman, Robert Minak mentioned that PNG National Stock Exchange (PNGX) market is tracking well amidst the challenges imposed by Covid-19. Trading activities for the 13 PNGX listed companies have been slow but sound, based on Zimcare Ltd audit report. Zimcare Ltd is a HR Consultant that was engaged by the Securities Commission to carry out an audit on the organization to improve operation. PNGX current market cap is around K120.0b. Mr Minak believes that this industry could generate an alternative source of income for the Nation’s budget if there is Government support, similar to other countries.

BPNG’s Treasury Bill overall auction results this week was over-subscribed by K53.7m from the total K89.6m offered. The weighted average yields for 182, 273 and 364 days all remained unchanged at 4.34%, 6.04% and 7.20% respectively from the last auction. There were nil offers for 63 and 91 days.

This week’s Central Bank Bills overall auction was over-subscribed by K48.0m from the total K145m offered. The weighted average yield for 28 and 63 days were1.32 and 2.01% respectively. There were nil offers for 91 and 182 days

Both the KSi Index and KSi Home Index rose by 0.2% and 0.4% to close at 5,843.40 and 13,931.40 points respectively for the week. The increase was due to rise in share price of financial stock (CCP) and Oil and gas stock (Oil Search).
 

Prime Minister James Marape said that the Oil Search and Santos merge could produce high value for the country should satisfy national interest. Marape said he wished the merged entity, which would be a top-20 global oil and gas company, ensures a significant part of its business remains in Papua New Guinea and supports local jobs. Meanwhile, the OSH board has considered the revised proposal and has determined to grant due diligence access to Santos, subject to the parties entering into an acceptable confidentiality agreement. 

Subsequent to a revised proposal, Oil Search Limited has agreed to a merger with Santos. Under this proposal shareholders of OSH will own 38.5% of the merged group compared to 36.9% under earlier proposal by Santos, last month. The aim of the merger of these 2 companies is to be the regional champion in the energy sector with a market capital of A$22.0b (PGK56.0b). The merged group would be within the S&P ASX-20 index and amongst the top 20 largest global oil and gas firms. 

The Independent Consumer and Competition Commission (ICCC) will continue to put on trial, businesses that have raised the prices of goods during the Covid-19 state of emergency (SOE) last year. Of the 104 businesses assessed, 48 complied paying a total of K450k in fines, while 56 still owe the ICCC up to K1.0m in unpaid fines. From April - June 2020, ICCC had carried out a nationwide price surveillance exercise June to implement SOE Order No. 8 on price regulation. Commissioner and Chief Executive Officer Paulus Ain, notes that the aim of the price regulation was to protect consumer interests from dishonest business houses taking advantage of the National SOE and increasing prices of basic goods. 

The 2021 Annual Business Advantage PNG Investment Conference will be held via digital conference from 7-9 September, 2021 and will feature keynote speakers addressing trends in global trade and investment, how large corporates and SMEs can work effectively together to boost economic growth, including collaborative panel discussions, interviews, case studies, videos and individual presentations.

The PNG National Stock Exchange Market (PNGX) announced the new appointment of its General Manager, Elizabeth Wamsa. Chairman David Lawrence stated that Wamsa joins an exclusive group of female leaders of emerging market exchanges globally and is one of the new generation young women leaders of PNG. 

Nasfund Contributor’s Savings & Loans Society (NCSL) and Kina Bank Limited (KBL) recently signed a memorandum of understanding which will enable NCSL staff to get home loans from the bank, under its home loan ownership scheme. KBL will take its 1st mortgage over the financed property, while NCSL takes the 2nd mortgage.

Following the departure James Rice, Paradise Foods Limited (PFL) announced the new appointment of Ben Wong, who will be the interim Chief Executive Officer for 3 months. Chairman Anthony Smare, notes that for the last 2 years, Mr Wong has been Chief Finance Officer and had filled in for Mr Rice previously.

The Bank of PNG (BPNG) announced that the Kina Facility Rate for August 2021 will be maintained at 3.0%.

BPNG’s Treasury Bill overall auction results this week was over-subscribed by K51.1m from the total K235.1m offered. The weighted average yields for 182, 273 and 364 days all remained unchanged at 4.34%, 6.04% and 7.20% respectively from the last auction. There were nil offers for 63 and 91 days.

Both the KSi Index and KSi Home Index dropped to 5,833.41 and 13,875.15 points, due to a drop in CCP price to K1.69 from K1.70 from the prior week.

Managing Director (MD) to Kumul Consolidated Holdings Ltd (KCHL) Mr Isikeli Taureka stated that the state is selling its non-core properties as being part of the State-Owned Enterprises (SOE) reform process. Mr Taureka added that the National Executive Council (NEC) approved the sale of non-core and non-income generating SOEs. The decision by NEC was to have a SOE reform and debt-free financing which was supported by the Asian Development Bank lending the State K500.0m over three years.

The non-core and non-income generating SOEs being sold in the National Capital District are; 38 vacant residential allotments adjacent to Pacific International Hospital at 3-Mile consisting of 2.91 hectares, vacant land at 16-Mile, and special purpose lease consisting of 28.3 hectares located off Sogeri road, adjacent to Pacific Brewery and Hugo Cannery.

PNG Ports Ltd gave a cheque of more than K26.0m to the Internal Revenue Commission for tax payments. According to PNG Ports Chairman Mr Kepas Wali, the tax payment was a result of prudent management by the entity during the COVID-19 impacted period and is another significant milestone for PNG Ports.

Kina Securities Limited (Kina) received a copy of a draft Determination by the PNG Independent Consumer and Competition Commission (ICCC) on its proposed acquisition of 89.91% shares in Westpac Bank PNG Ltd business in Papua New Guinea. The ICCC’s draft Determination requested comments and submissions from stakeholders before a final Determination is made, which is expected in mid-September.

Also note that the draft Determination contains statements and reasoning which Kina contests. Kina is invited to make a presentation to, and participate in, a pre-decision conference to be held in Port Moresby on 11 August 2021 to outline the commercial and economic benefits to PNG arising from the acquisition, and to allow Kina and other stakeholders to discuss and provide comments on the draft Determination. Final comments and submissions on the draft Determination are due by 20 August 2021.

On the other hand, Kina announced that it has received notification from; (i) the Reserve Bank of Fiji (RBF) that conditionally approved Kina’s application to conduct business in Fiji as a commercial bank. (ii) the Fijian Competition & Consumer Commission (FCCC) that, in relation to the acquisition of Westpac Fiji by Kina, the FCCC is satisfied that the transaction will not harm or affect competition in the Fijian market and has therefore granted a conditional approval.

Kina’s MD and Chief Executive Officer (CEO) stated: “On behalf of the Kina Board, I would like to thank the Reserve Bank of Fiji and the FCCC for their positive consideration of Kina’s proposed acquisition of Westpac’s Fijian Assets. As the Sale and Purchase Agreements for both Fiji and PNG, though separate, are interconditional and to complete simultaneously, we continue to work with Westpac in both Fiji and PNG to successfully complete the transaction at the earliest opportunity.”

Oil Search Ltd (OSH) announced its performance for Q2 period ended 30 June and main highlights as follows; 2021 production and capital expenditure guidance maintained, Q2 2021 operating revenue up 21.5% from Q1 2021, Papua LNG and Pikka oil development progressing as planned and strong operating cashflows enabled continued debt repayments. Acting CEO Mr Peter Fredricson said, “OSH delivered strong production in the latest quarter, supported by the safe completion of the major planned maintenance campaign at PNG LNG by the operator, ExxonMobil”.

In response to a media report in Australian Financial Review on 22 July 2021 asserting that BSP Financial Group Ltd’s (BSP) chairman, Sir Kostas Constantinou OBE, was in breach of Papua New Guinea’s prudential standards by exceeding the maximum stipulated term for a director on the board of a financial institution. BSP confirmed the tenure of its chairman, is the subject of an exemption issued by BPNG in 2019 in relation to prudential standards on governance matters and that BPNG has consented to Sir Kostas' chairmanship continuing to February 2023.

The ICCC declined the application on the proposed acquisition of 49% PNG Air Ltd shares by Link PNG. ICCC has considered all information on the application and pursuant to Section 82(3)(c) of the Independent Consumer and Competition Commission Act 2002 (“ICCC Act”).

This month’s COVID 19 Bond Auction results were over-subscribed by K105.11m from the total K463.49m offered. The weighted average yields for series S15022023-Covid-19, S150222024-Covid-19, S15022026-Covid-19, S15052029-Covid-19, S15022030-Covid-19 and S15082031-Covid-19 all remained unchanged at 8.50%, 9.00%, 9.70%, 9.90%, 9.90% and 9.90% respectively from the prior auction.

The week’s Treasury Bill overall auction results were under-subscribed by K172.10m from the total K270.50m offered. The weighted average yields for 182, 273 and 364 days all remained unchanged at 4.34%, 6.04% and 7.20% respectively from the prior auction. There were no bids for 273 days and nil offers for 63 and 91 days.

The KSi Index dropped by 0.2% to 5,833.63 points while the KSi Home Index remained unchanged at 13,931.40 points to end the week.

• Prime Minister (PM) James Marape stated that the Government is aiming at securing better deals for the country’s major projects. The Papua LNG moves into the next phase pre - feed in September as the financial stability agreement was signed in February. PM said there is considerable amount of discussion for the Pogera project, given the outcome of the last agreement secured under the previous Government. The P’nyang project, the State’s negotiating team and ExxonMobil will commence talks later this month. The Wafi -Golpu project, all parties are expected to convene negotiations this month with all stakeholders following the term sheet clearance by the State. 
• In addition, PM Marape said the new production levy negotiated for the petroleum sector is 5.0%, royalty and development levy for PNG at 2.0% on gross revenue with no deductions. 5.0% of liquid petroleum gas (LPG) has been secured and is sufficient to replace the current volume of LPG imported for the domestic market. 
• Bank of PNG (BPNG) released the new 50 toea coin, which features an image of a Birdwing Butterfly. The coin became legal tender on 1 July 2021. Bank Governor, Loi Bakani said the 50 toea coin has been used over the years as a commemorative coin to mark special and significant events in the country. The new design was originally used on the 1 toea coin that had been demonetized in 2012. 
• BSP Financial Group Chief Executive Officer (CEO), Mr. Robin Fleming reported that the current bid price of A$5.00 (K6.6 0) on the ASX market indicates shareholder’s interest in the stock. The actual stock price will be determined after the first trades are performed which is expected to be lower during the first months of trading. Various shareholders have successfully moved their shares onto the ASX register, ready to trade. Interested shareholders who wish to have their shares migrated to the offshore register would require a tax clearance certificate to support the share shunt application form. At the launch of BSP’s ASX listing last month, Group Chairman Sir Kostas Constantinou recapped that the listing will give shareholders access to a far more liquid market and also give BSP potential new sources of capital to fund any future strategic growth opportunities. 
• The Board of Credit Corporation PNG (CCP) announced the permanent appointment of Mr. Richard Sinamoi as the Chairman . Mr. Sinamoi has been the Group’s Acting Chair since his election following the 2021 Annual General Meeting (AGM) held in June 2021. Mr. Sinamoi joins newly elected Directors Mr. Stephen Humphries and Sir Melchior Togolo to the CCP Board. 
• Kina Bank (KBL) announced a loan product for local wholly owned small to medium enterprises (SMEs) in the country, under its K50.0m concessional loan facility. CEO, Greg Pawson said the product would carry a 4.0% interest rate. This SME loan product comes with nil fees such as upfront application, documentation, inspection, drawdown and settlement fees. CEO noted that this is not Government-funded, but rather an initiative led by KBL. Customers can apply for a maximum K500k secured loan with a repayment term of 15 years and a maximum K100k for an unsecured loan for a term of up to 7 years. Executive General Manager – Lending, Asi Nauna said there would be a quicker turnaround time for credit decisions as part of the process. 
• This week’s Treasury Bill overall auction results were over -subscribed by K32.98m from the total K246.32m offered. The weighted average yields for 182, 273 and 364 days all remained unchanged at 4.3 4 %, 6 .04% and 7.20% respectively from the prior auction. There were nil offers for 63 and 91 days. 
• Both the Kina Securities Index and Kina Securities Home Index remained unchanged ending the week at 5,843.40 and 13,931.40 points respectively
   

• Following the second post-referendum consultation meeting in Wabag, Enga Province this week, Prime Minister James Marape and ABG President Ishmale Toroama agreed that Bougainville would get its independence in 2027. Mr. Marape is scheduled to take the referendum results to the 11th National Parliament to table the outcome and rectify the results in 2023. Both leaders have signed the Joint Supervisory Body meeting resolution that gives PNG Government seven years to implement Bougainville’s independence.
• According to Minister for State Enterprises William Duma, the Government will not allow for another motor vehicle insurance player in the market. Minister Duma says the state-owned entity; Motor Vehicle Insurance Ltd (MVIL) was returning good dividends to Kumul Consolidated Holdings Ltd (KCHL). MVIL Managing Director Michael Makap noted that for FY2019, MVIL had paid a total of K281.0m in dividends to KCHL, further adding that for FY2020, MVIL anticipates a net profit after tax of K67.0m and according to the dividend policy of KCHL, may be paying a total of K33.0m in dividends for 2020.
• In addition, Motor Vehicle Insurance Limited (MVIL) have announced they will be opening their new service center at the Vision City (VC) Mega Mall soon, purposely for the working class whom have limited time to access services such as licensing, vehicle registration and insurance. The soon to open VC branch will add on to the number of branches that MVIL has throughout the country. Currently there are 26 MVIL branches nationwide.
• The Independent Consumer and Competition Commission announced that there would be an increase in price of petrol, diesel and kerosene for the month, effective 8 July 2021. The change in retail prices are mainly driven by reduction in supply from the OPEC and its allies, and increased global demand. Consequently, fuel prices in Port Moresby for petrol, diesel and kerosene rose to K3.70, K3.20 and K2.90 per litre respectively.
• The State has officially transferred its 67.0% interest in the Ok Tedi Mining Ltd to Kumul Minerals Ok Tedi Ltd (KMOTL), were previously held under Kumul Mineral Holdings Ltd (KMHL). According to KMOTL Chairman Bonny Nanai, the signing of the share transfer documents was a culmination of the State’s broader restructure of the mining and resource holdings that required all mining assets to be held under KMHL. KMOTL will now be the shareholder on record for the 67.0% shares in OTML and the dividends for these shares will be paid to KMOTL. However, dividend would be distributed by KMOTL in accordance with the Government’s dividend policy.
• Credit Corporation Limited (CCP) announced the departure of its Chief Risk Officer, Karen Mathers whom will be pursuing an external career opportunity. Upon acknowledging Mathers’ contribution to the group’s commitment to the high levels of governance, compliance and risk management, CCP interim Chief Executive Officer, Danny Robinson also stated that the CCP will be recruiting an executive to replace Mathers adding that an announcement would be made soon. 
• The Bank of PNG’s (BPNG) assessment of key macroeconomic indicators point a slower recovery in economic activity with the ongoing impact of Covid-19 pandemic. The private sectors have been mostly impacted, sales declined and employment remained flat, while headline inflation eased in the first quarter of 2021 at 4.7%, compared to 5.7% in the December quarter of 2020. To support the economic recovery, the BPNG stated that the Kina Facility Rate for the month of July 2021 will be remained unchanged at 3.0%.
• This week’s Treasury Bill overall auction results were over-subscribed by K77.4m from the total K385.5m offered. The weighted average yields for 182 and 364 days all remained unchanged at 4.34% and 7.20% respectively from the prior auction. There were nil offers for 63, 91 and 273 days.
• This week’s Central Bank Bills overall auction was over-subscribed by K96.0m from the total K172.4m offered. The weighted average yield for 28 remained unchanged at 1.33% from previous auction. There were nil offers for 63, 91 and 182 days.
• Both the Kina Securities Index and Kina Securities Home Index remained unmoved ending the week at 5,841.3 and 13,931.4 points respectively.

• Police Commissioner and Controller of the PNG Covid -19 National Pandemic Response, David Manning said the country is considering banning all international flights in and out of PNG following the rapid spread of the Covid -19 Delta variant to over 92 countries. Mr. Manning said the National Control Centre as a responsible organization tasked with the country’s Covid -19 response is closely monitoring developments in countries around the world including Australia and Fiji. If necessary PNG will consider closing its borders and banning all flights into and out of the country. 
• Prime Minister (PM) James Marape stated that the Government is focused at lowering the cost of energy to improve the country’s economy. PM Marape said reducing the cost of energy, particularly electricity and fuel was “critically important” in driving economic growth and laying groundwork for future prosperity. Further adding that the price of all fuels would need to be eased in order to lower the cost of doing business in PNG and to help build major infrastructure and develop a wide range of service industries. 
• The World Bank approved US$100.0m (K352.0m) to support PNG’s sustainable recovery. The money provided in the form of highly concessional credit. This financing will help safeguard routine health services while delivering the rollout of Covid -19 vaccinations, help provide financial assistance to micro, small, and medium -sized enterprises (MSMEs) for job protection and ease the tax administration burden on small businesses. It will also support the government's commitment to ensure fiscal and debt sustainability, enhance women's voice and opportunities in decision making, improve financial sector efficiency and financial inclusion, and prepare PNG for the impending impacts of climate change. 
• According to PNG Power Limited Chairman Moses Maladina, Managing Director Flagon Bekker has resigned due to personal reasons, thus will be returning to Australia. In the meantime, Obed Baita, a National with 30 years of experience will take charge. 
• Additionally, National Institute of Standards and Industrial Technology (NISIT ) revealed that PPL, state owned entity lost on average K 2 5.0m a month due to theft and has therefore recommended that PPL either immediately replace all its easipay meters or standardize them to help prevent against lost revenue. 
• According to Kina Bank’s Executive General Manager for Lending Asi Nauna, the lending environment shifted from funding growth to providing relief for its current customers both in retail and business due to the effects the Covid -19 had on business activities. The bank is supporting its existing customers impacted through loan repayment relief arrangements. In doing so, interest rates have been reduced by 2.0% for working capital facilities or overdrafts to help support customers as well. For its home lending or mortgages perspectives, the bank re -priced interests for home loans and investment property loans to 6.95 % and 7.95 % respectively. 
• At its recently held Annual General Meeting, Credit Corporation Limited (CCP) announced the appointment of Richard Sinamoi as Acting Chairman following the departure of Syd Yates . Mr Yates had been appointed by CCP Board on 21 May 2018 as a Non - Executive and Independent Director, eventually elected as Chairman on 27 November 2018. The Board acknowledged Mr Yates for his exceptional contribution and service s to the firm. 
• This week’s Treasury Bill overall auction results were oversubscribed by K143.2m from the total K428.4m offered. The weighted average yields for 182, 273 and 364 days all remained unmoved at 4.3 4%, 6.04% and 7.20% from the prior auction. There were nil offers for 63 and 91 days. 
• Both the Kina Securities Index and Kina Securities Home Index remained unmoved ending the week at 5,843.40 and 13,931.40 points respectively

• Minister for Fisheries and Marine Resources Dr. Lino Tom said The National Fisheries Authority (NFA) is ready to implement the Pacific Marine Industrial Zone (PMIZ) project. Dr. Tom held a meeting in Madang recently to present to the Government and Provincial Government the fisheries potential of the PMIZ project. The PMIZ will contribute to developing a vibrant, broad-based and value-adding fisheries sector that will be globally competitive and domestically inclusive, providing revenue for the Government, creating wealth and securing food for the people he said. 
• According to PNG Manufacturers Council Chief Executive Officer (CEO) Chey Scovell, the country’s current economic outlook at present is a difficult one resulting from public policy decisions of past and present. CEO said forex supplies tightened and the State’s creditors’ list is increasing. There is also a decline in quality education and infrastructure with no reports of increased productivity in the labor market. While there is always a small number of firms that do well in recessions such periods of economic decline are named thus, because for most it’s awful to bleak at best CEO said. 
• The new Small Business Tax (SBT) is good for the micro sector but not the small-to-medium enterprises (SMEs) sector according to the Micro, Small and Medium Enterprise (MSME) Council. President Desmond Yaninen said the SBT would only ensure lower tax payments by the micro sector. Within the MSME, we have micro, small and medium enterprises, the current small business tax is great for micro enterprises who get to pay lower taxes, he said. However, he added that the SBT needed to be amended to suit all. 
• A Company producing and exporting vanilla is partnering with the PNG Expo 2020 team to promote its products at the Dubai World Exposition in October. Kamapim Ltd Managing Director Dr. Nancy Irwin said they wanted to produce the best quality bean for the international market through quality assurance production methods. When I started the project, the quality of the beans was poor and full of fungus due to lack of processing knowledge. We started working with landowners through a cooperative production and marketing structure to improve quality. Dr. Irwin said the beans were tested internationally and were consistently classed as A grade. I believe the cooperative production methods applied by our company could be used nationally as one of the models to improve quality for the export market as well as to maximize revenue for the farmers she said. 
• The PNG National Statistics Office released its March quarter CPI report and the result for the period saw CPI inflation rose to 0.6% for the quarter and for the 12 months to March quarter 2020 was 4.6%. The biggest CPI increase for the quarter and rolling year was seen in Education group by 19.9% mainly due to the upturn in educational fees, followed by Health group by 5.0%, Transport group by 2.2%, Recreation group by 1.4%, and Food and nonalcohol beverage group by 1.0%. 
• Twinza Oil PNG is hopeful its terms of the proposed Pasca A offshore oil and gas project is acknowledge by the Government to get the project online. Country Manager Roppe Uyassi said that the terms had met the desired Government take as confirmed by Deloitte. Prime Minister James Marape also wants the project agreement to be completed this month. Twinza hopes to move forward with the country’s first offshore oil and gas project. 
• Institute of National Affairs (INA) Executive Director Paul Barker said many commodity prices have improved significantly since mid-last year, this was the result of a post-lockdown economic recovery in some countries, particularly on the success of the vaccination programme in many developed countries. Oil and most extractive commodity prices are much firmer, as some agricultural commodities, including vegetable oils and some beverages, providing domestic stimulus and getting some needed income out into rural areas, he said. 
• The week’s Treasury Bill overall auction results were under-subscribed by 10.7m from the total K253.4m offered. The weighted average yields for 182, 273 and 364 days remained unchanged at 4.35%, 6.04% and 7.20% from the last auction. There were nil offers for 63 and 91 days. 
• Both the Kina Securities Index and Kina Securities Home Index remained unchanged to end the week at 5,831.11and 13,566.12 points respectively

• Prime Minister James Marape announced that local shareholders in the Porgera mine would have the option of buying the 49.0% shares held by operator Barrick Niugini Ltd (BNL) when handed over the new Porgera Framework Agreement to BNL President and the Chief Executive Officer (CEO). According to the CEO of BNL, the cost of restarting the Porgera mine is around K1.1bln. A development forum is expected this month in Enga where Special Mining Lease and Leases for Mining Purposes and all affected areas would gather to allocate the benefits. 
• Treasury Minister Ian Ling -Stuckey announced a review of the Bank of PNG (BPNG) which will include the review of team members and a terms of reference. Mr Ling -Stuckey said the review will be chair by former Chief Secretary Robert Igara and two members are former BPNG Governor Sir Wilson Kamit and Australian academic Dr Stephen Howes, all of whom have thorough experience of the PNG financial system and reform. He said it would be the first review of the central bank and the Central Banking Act 2002 since late Sir Mekere Morauta’s financial system reforms when he was Prime Minister from 1999 to 2002. Noting that a lot had changed since then , thus made the need for a review even more crucial. 
• Despite the setbacks and market challenges faced by farmers in the country, PNG’s vanilla beans are being accepted and used by major industrial users in their formulations of products. According to a report by global vanilla trader Aust & Hachman this month, PNG remains competitive in the global market against giants like Madagascar and Uganda. Minister for Agriculture and Livestock applauded local vanilla farmers and exporters in the country who have helped in enabling the country to solidify its position in the globe. 
• BSP Financial Group Ltd (BSP), formerly known as Bank South Pacific Ltd, recently did their rebranding which involve the launching of its new logo. The new range of BSP logos still retains its iconic kundu drums including its core brand elements, but with a clean, simplified and modern look, strengthening its position in the corporate field. CEO Robin Fleming said in recent years the bank had transformed, providing customer -focused changes and expanding footprints thus the time was right to launch a refreshed brand with a new tagline ‘Our Bank. Our People’ from ‘We are you. We are BSP’. 
• Despite the impact of Covid’19 pandemic, the Teachers Savings and Loan Society (TISA) declared a net audited profit after tax of K44.9m. The Chairman and CEO of TISA announced that its 63,000 members earned a collective 2020 additional bonus interest of more than K24.7m. The bonus interest represented 7.0% of the members’ general savings account. 
• In addition, CEO Michael Koisen said with a balance sheet of K986.0m and 63,000 members had a size to upgrade to a bank. TISA banking license application was still being processed by the regulator. 
• Mr. Koisen added that TISA Rua K100.0m development project is expected to be completed in the second quarter of this year. The TISA Rua will be a 10 -story mixed -use development project that will offer options for residential apartments and commercial office space. The building will have three penthouses at the top floor, while the rest of the level will be used as office space and the ground floor will be used for commercial purposes.
• The Bank of Papua New Guinea announced that the Kina Facility Rate for June 2021 is maintained at 3.0%. 
• The week’s Treasury Bill overall auction results were over -subscribed by 104.2m from the total K153.6m offered. The weighted average yields for 182, 273 and 364 days remained unchanged at 4.35%, 6.04% and 7.20% from the last auction. There were nil offers for 63 and 91 days.
• This week’s Central Bank Bills overall auction was under -subscribed by K7.0m from the total K266.4m offered. The weighted average yield for 28, 63 and 91 days were 1.33%, 2.02% and 3. 00% respectively. There were nil offers for 182 days.
• Both the Kina Securities Index and Kina Securities Home Index dropped by 0.1% and 8.1% to 5,831.11and 13,566.12 points respectively. This was mainly attributed to the drop in share prices of Credit Corporation and Kina Asset Management Ltd.

• PNG Chief Justice Sir Gibbs Salika recently announced the newly - appointed judges of the Supreme and National Court guiding them to be thorough in their roles as it was crucial to maintain the rule of law and order with cases without fear or favor. The appointees include; Justice John Numapo, Justice Vergil Narokobi, Justice Sinclair Gora, Justice Paulus Dowa and Justice John Kaumi. 
• Department of Lands and Physical Planning and Nambawan Super Limited (NSL) recently signed a memorandum of understanding (MoU) to offer affordable housing development in Port Moresby. According to Lands Minister John Rosso, the department had been working with the Fund and National Capital District Commission to facilitate the development of a master plan which would include affordable housing. NSL has leased Portion 2158 for the housing development. Now that the MoU has been signed, the process of developing the 8 - 9 -Mile land will commence starting with Portion 2158, which is about 36 hectares. 
• The operator of the Pisca A gas project Twinza oil Ltd, issued the statement in response to recent comments by Petroleum Minister Kerenga Kua regarding the Pasca A gas agreement on May 25. Chief Executive Officer Ian Munro said that Twinza is currently awaiting a response from the Petroleum Minister as the terms offered to the State is with the Minister for consideration. The completion of the Pasca A gas agreement this month would allow the project to move into the front -end engineering and design phase, with a final investment decision in late 2022 and first production in 2025. CEO Munro warned that a continued delay in concluding the gas agreement would impact the planned project schedule and could see production move out to 2026. 
• The Board of Directors for PNG Air Limited announced the resignation of Chief Executive (CEO) and Financial Officer (CFO), Anthony Pereira due to family issues. The Board thanked Mr Pereira for his contribution to the company over the past 18 months. Additional movements in the company include the appointment of Stanley Stevens as Acting CEO and Nisaal Jai as Acting CFO . 
• Following the announcement of its successful dual listing on the Australian Exchange Market (ASX), BSP Financial Group (BFL) Limited’s shares have attracted a lot of demand from investors. CEO Robin Fleming explained that being listed on the ASX does not mean that sh areholders can automatically trade on either exchange, as there were processes and compliance requirements needed for a shareholder to obtain a tax clearance certificate to aid the application to move shares from the PNGX to ASX. 
• The Board of Kina Asset Management Limited announced that its Annual General Meeting will be held online on 23 June 2021, commencing at 10:00am. 
• At present there is a project collaboration between Airways Residences and ETS Architects which involve the construction of a spacious new gated garden estate with one -, two - and three - bedroom luxury apartments gradually taking shape in Port Moresby. The apartments are being built on the back of speculation that more executive -level accommodation will be needed as the oil and gas sector ramps up with new projects. The project due for completion in August 2021 .
•  The week’s Treasury Bill overall auction results were over -subscribed by K6.6m from the total K255.0m offered. The weighted average yields for 182, 273 and 364 days remained unchanged at 4.35%, 6.04% and 7.20% from the last auction. There were nil offers for 63 and 91 days. 
• The Kina Securities Index increased by 0.2% to 5,835.78pts, while the Kina Securities Home Index remained unmoved at 14,762.59 pts. This is mainly attributed to the rise in share price of Bank South Pacific Limited.

• Treasurer Ian Ling-Stuckey approved Central’s 2021 budget and acclaimed its commitment to sustainable development by empowering grassroots people. The K272.7 million budget focuses on building the economic base of the province based on agriculture, tourism and sports. Governor Robert Agarobe’s money plan is in good alignment with the Marape Government’s take back PNG agenda, Ling-Stuckey said.
• National Planning and Monitoring Minister Rainbo Paita presented a cheque of K1.65 million for four impact projects in the Duke of York Island local level government, Kokopo, East New Britain. The funding was sourced from the Department. The four impact projects were the Molot health center reconstruction, the upgrading and extension of Duke of York ring road, the white copra freight subsidy and the Duke of York Island solar power projects.
• South Pacific Brewery Limited appointed Stan Joyce has the new Board Chairman. Mr. Joyce joined the company as marketing manager in 1995 and became Managing Director in 2007. He retired in September 2019 and joined the Board as a Director. He succeeds the late Sir Joseph Tauvasa who passed away in January. He is keen to work with the Heineken Directors and local directors to provide the winning combination of international best practices in the brewing industry, combined with local knowledge of the market and environment in PNG Joyce said. 
• Puma Energy PNG Ltd’s crude Foreign Exchange (Forex) orders have doubled in the last six months, says Country General Manager and Director Hulala Tokome. Mr Tokome said because of the global oil price trend and lack of forex in PNG. He said the impact of forex shortage was also felt by other businesses with delays in forex orders to settle imports and other services. Between last December and May we have seen our crude forex orders doubling due to the global oil price and also lack of forex within the market, he said.
• The Board of Credit Corporation PNG (CCP) is pleased to announce that it has declared a total dividend of 18 toea per share including a special dividend of 12.2 toea per share in respect of the FY20 financial year. The planned processing dates for the dividends are: Ex-date: 31st May 2021, Record Date: 7th June 2021 and Payout Date: 28th July 2021.
• In addition, CCP announced their Annual General Meeting of shareholders will be held online commencing at 10:00am on Friday 25th of June 2021.
• The Australian Stock Exchange (ASX) welcomed a new banking stock to its electronic boards on Tuesday this week with the listing of scrip in BSP Financial Group Limited. BSP is the largest financial services provider in the South Pacific, with banking operations in Papua New Guinea (PNG), Fiji, Vanuatu, Solomon Islands, Samoa, Tonga and the Cook Islands. BSP Group’s Chairman Sir Kostas Constantinou said that the dual listing aimed to boost the liquidity of the group’s shares and open new sources of capital to fund business growth. The company is the second PNG-based financial services provider to list on the ASX, following the listing of Kina Securities in July 2015.
• According to Chief Executive Officer (CEO) of Paradise Foods Limited (PFL) James Rice, downstream processing should be encouraged as it means additional job creation. CEO said the company had localized imported manufacturing inputs in its ice cream cones, peanut butter, ice cream flavouring and some labels as well. PFL also have the plans to go into water bottle preforms, water bottle caps, ground corn and biscuit packaging. CEO further said that downstream processing will give the company a shorter supply line and allow to settle in Kina, however the price will not be better and there will still be foreign currency risk, as the suppliers have to buy raw materials from overseas.
• The week’s Treasury Bill overall auction results were under-subscribed by K103.0m from the total K138.65m offered. The weighted average yields for 182, 273 and 364 days remained unchanged at 4.35%, 6.04% and 7.20% from the last auction. There were nil offers for 63 and 91 days.
• The Kina Securities Index and Kina Securities Home Index increased by 0.1% and 9.3% to 5,825.79 and 14,762.59 points respectively mainly attributed to the rise in share price of industrial stock City Pharmacy Limited and Kina Asset Management Limited.

• According to Finance Secretary Dr Ken Ngangan the configuration of Goods and Services Tax Section 65 in the Information Financial Management System (IFMS) is progressing well. “When we switched on the section 65 component in IFMS, in just two days, we collected K110,000 to K120,000, we expect that there will be improved GST collections at the point of payment on the IFMS and this was all part of improving and increasing revenue collection” said Dr Ngangan.
• Bank of BPNG’s (BPNG) Governor Mr Loi Bakani said BPNG’s foreign reserve is estimated to be K8.8b (US$2.5b). Mr Bakani said foreign exchange (FX) inflows this year were mainly from Government overseas borrowings while outflows continue to be from Government debts servicing. BPNG has also provided some interventions which commercial banks used to settle imports. Moreover, per latest S&P Global rating on the country, FX reserves have held steady over the past 12 month.
• The Independent Consumer and Competition Commission (ICCC) has cleared the proposed acquisition of The Trafigura Group Pte Limited (Trafigura) in Puma Energy Group Pte Limited. ICCC’s Chief Executive Officer (CEO) Mr Paulus Ain said although both Trafigura and Puma Energy are private companies and incorporated in Singapore, they applied to ICCC for clearance as Puma operates in the country. Through its wholly owned subsidiaries and Based on information provided, there are no views of a monopoly market.
• According to Hon. Richard Maru there are on-going negotiations with potential investors on various projects to be implemented on a 9,500 hectors of land in the East Sepik Province-East Sepik plains which Kumul Consolidated Holdings had purchased. One successful project on the land is the commercial chicken meat production known as the Sepik Fresh Poultry Product set to generate K50.0m –K100.0m per year.
• CEO to Nambawan Super Limited (NSL) Mr Paul Sayer provided an update of the superfunds investments stating that its assets have grown to more than K8.14b. He said although the superfund encountered challenges with its investment return, assets continued to grow having assets domestically and internationally. Thus economy and overseas market changes may impact the valuations of the superfund and gradually onto its members. But NSL expects valuations to recover as the economy improves. 
• Moreover, NSL’s investee company Rangeview Precinct, a retail and residential project worth K296.0m comprising of a commercial shopping mall and residential town houses, located in Waigani is set to be completed in October. 
• Kina Bank will reduce its Indicator Lending Rate (ILR) to 6.25% from 11.65% effective 1 June. According to Kina Bank this change will modernize and bring Kina Bank in line with international best practice making it the lowest ILR in the country and give customers more transparency on loan costs as well as control over their finances.
• BSP Financial Group Limited (BSP) announced that, giving due regard to BSP’s dividend policy, capital reserves, liquidity position and its assessment of the impact from COVID-19, have determined a final dividend of K1.05 per share as the final dividend for 2020. With a K0.25 per share interim dividend paid in October 2020, the total dividend payment for the 2020 financial year is K1.30 per share, generating a yield of 10.83% on the current share price of K12.00 (as at 11th May 2021).
• Q1 of 2021 saw BSP’s profit decreased by 2.6% from Q4 2020, due largely to seasonal affects and increased technology investment. Nevertheless, BSP remains cautiously optimistic that business conditions will improve during the year.
• Further, BSP Chairman, Sir Kostas Constantinou OBE announced that the Australian Stock Exchange (ASX) had approved BSP’s application for ASX listing.
• City Pharmacy Limited notified its shareholders that the Annual General Meeting will be held on Thursday 10 June at 10:00am and will be conducted by way of Zoom audio participation.
• The week’s Treasury Bill overall auction results was under-subscribed by K71.86m from the total K148.95m offered. The weighted average yields for 182, 273 and 364 days remained unchanged at 4.35%, 6.04% and 7.20% from the last auction. There were nil offers for 63 and 91 days.
• The Kina Securities Index dropped by 0.1% to 5,820.86 points while the Kina Securities Home Index increased by 0.3% attributed to the rise in share price of industrial stock City Pharmacy Limited  to K0.70 to end at 13,508.83 points respectively.

• A weak business and investment climate is probable to continue in PNG given the ongoing foreign exchange shortages, a hard stance from the current Government towards foreign investment and the prolonging Covid-19 pandemic according to the Asian Development Bank 2021 outlook released. The economy thinned as Covid-19 reduced demand for exports and brought nationwide lockdowns that hindered commerce, mobility and restricted international travel and trade. Development partners responded with budgetary support, taking comfort from an International Monetary Fund staff-monitored programme scheduled to end in June. The economy is expected to recover in 2021, although a recent surge in Covid-19 cases threatens this. Development partners are assisting with budgetary support and the delivery of Covid-19 vaccinations.
• According to PNG Business Council, the Government settled around K200m that it owed to businesses.  Executive Director Douveri Henao confirmed that after meeting with Treasurer Ian Ling-Stuckey. The large portion of debts are for hire cars. Hotels, professional services and other sectors are still being considered. Mr Henao highlighted that there is a committee in the Department of Treasury to look at payments to suppliers.
• Total said it had agreed with the GoPNG to proceed with a liquefied natural gas (LNG) project in the country, following a high-level meeting in Paris between the CEO of the French major and a senior PNG Government delegation. The decision was to remobilize project teams and of other required resources with a final investment decision due in 2023. Total and PNG Authorities will cooperate to create significant in-country value and to implement the Papua LNG project in an exemplary manner and taking into highest consideration the biodiversity and environmental stakes as well as the local communities’ rights.
• Nasfund and Ihu Special Economic Project Development Corporation (ISEZDCL) have entered a partnership with the signing of their 2nd MOU. Nasfund Chairman Charles Vee addressed two key strategies such as increasing the membership outside the private sector and focusing on the economic infrastructure investments through public private partnership. Mr Vee further stated that such partnerships will facilitate investment perspectives thus addressing other issues concerned. ISEZDCL has unique expertise and experience in areas of special economic zone development, planning and implementations.
• Nambawan Super Limited (NSL) will be conducting an employer and members conference via National Broadcasting Corporation (NBC) television followed by a question and answer session on NBC radio this month. CEO Paul Sayer confirms that the conference is for “Members and employers who want to understand how the low investment return occurred for 2020,” and to understand more about how the Fund manages the substantial asset base of K8.14 billion. Furthermore, the conference will enable NSL to go through the Fund outcomes in detail and explain how investment returns are determined.
• Bank South Pacific (BSP) Limited’s sub-branch in Vanuatu recently launched a new banking system called “Flexcube Banking System”, this will allow BSP Vanuatu to advance several banking operating and reporting systems including real-time risk and credit bureau analytics, foreign exchange and telegraphic transfers, document management and branchless banking.” Additionally, the upgrade also saw the launch of a new internet banking portal and operating platform.
• Additionally, BSP’s Annual General Meeting will be held via virtual meeting on 21 May 2021 at 10:30am.
• This week’s Treasury Bill overall auction results was undersubscribed by K10.9m from the total K105.0m offered. The weighted average yield for 182 days sunk by 0.03pts to 4.35%, while 364 days remained unchanged at 7.20% from the last auction. There were nil offers for 63, 91 and 273 days.
• Both the Kina Securities Index and home index closed the week unchanged at 5,825.19 and 13,463.45 points each.

• According to PNG Customs Chief Commissioner Mr David Towe, PNG Customs collected K613.1m in duties and excise and K273.1m from import goods and services tax (GST) in Q1 this year. Mr Towe said the revenue collected during Q1 has exceeded the revenue collection target by 7.0% or K41.7m set by the Government and also represents a 27.0% increase in the budget projection for the year.  Mr Towe added that the higher the Government budget projected revenue collection demonstrated an increased Customs compliance by strong border control and security measures.
• Per the recent National Energy Authority Bill 2020, Minister for Energy and Rural Infrastructure Hon. Saki Soloma said “The National Energy Authority (NEA) will be the paramount body for the management of the energy sector to deliver affordable and consistent supply of electricity for commercial and industrial businesses, including power supply to proposed economic corridors, industrial zones, towns and cities and will ensure the development of all indigenous energy sources including hydro, gas, solar, geothermal, coal, wind, biomass and biofuel.”
• President for PNG Micro Small and Medium Enterprise Council (PNG MSME) Mr Des Yaninen said the Papua New Guinea Small-to-Medium Enterprise Corporation (PNG SME Corporation) is working on a revised five-year plan (2021-2025) and to address and revise the reserved activity listing. The highlight was that the Government needs to protect locally owned businesses from foreign competition thus PNG SME Corporation aims to get this legalized. 
• PNG Cocoa Board’s Chief Executive Officer Mr Boto Gaupu had expanded the cocoa price support programme by K200,000 in Morobe Province. According to Mr Gaupu, Morobe Province’s current cocoa production was 4,500 tonnes, valued at K30.0m which K19.0m is earned by the farmers. Consequently, income earned from cocoa production generates other economic activities such as stores and PMV operations. He added that the Province was now the leading supplier in cocoa production and is confident that with the support of all farmers, production can go up to 10,000 tonnes and can bring more than K100.0m into the Province.
• Member for Samarai-Murua District Hon. Isi Henry Leonard said the district will build a vanilla processing centre on Misima Island to assist local farmers in selling their vanilla beans. The District has K500,000 in COVID-19 SME support funds and an agriculture component of K1.0m which Hon. Leonard started a vanilla trading programme and brought in a registered trainer to look into the entire trading of vanilla – from farming or vanilla processing to even marketing.
• South Pacific Brewery Limited (SPB) has made a loss of K21.5m in income after the restriction of alcohol sales per the National Isolation Strategy. SPB’s Managing Director Mr Ed Weggemans said “this represented a loss in sales volume of 85.0% in the channels that were closed and would have generated K17.1m in excise duty and K4.4m GST.”
• Link PNG confirmed that itself and PNG Air have reapplied to Independent Consumer and Competition Commission (ICCC) for Link PNG to acquire a minority shareholding in PNG Air. Both PNG Air and Link PNG believe ICCC approval of this will benefit Papua New Guinean Nationals and travellers.  Link PNG Chairman Sir Kostas Constantinou, and PNG Air Chairman Mr Augustine Mano advised that the proposed joint venture between Link PNG and MRDC is based on PNG Air remaining as an independent airline, setting its own airfares and selling its own tickets totally separately from Air Niugini.
• According to Mr Robin Fleming, Bank South Pacific Financial Group Limited (BSP) and the Department of Commerce and Industry (DCI) have agreed to increase the maximum loan under SME credit enhancement facility to K5.0m from K3.0m. “We are also reviewing the required equity percentage at the request of DCI to reduce this based on feedback from SME bodies and forums to assist SME’s who have repayment capacity to take advantage of the credit enhancement facility. At this stage, BSP has not received the funding planned for this year but that is not preventing BSP from giving loans under the facility. There remains significant capacity for BSP to continue to assess, approve and funds loans under the facility,” said Mr Fleming. 
• The week’s Treasury Bill overall auction results was over-subscribed by K93.40m from the total K38.0m offered. The weighted average yields for 182, 273 and 364 days remained unchanged at 4.38%, 6.04% and 7.20% from the last auction. There were nil offers for 63 and 91 days.
• The Kina Securities Index dropped by 4.6% to 5,825.06 while the Kina Securities Home Index remains jumped by at 13,463.45 points respectively.

• Twelve Government Department heads recently signed their employment contracts witnessed by their families, the media and Governor-General Sir Bob Dadae, these include Secretary for Department of Prime Minister and Executive Council Mr Ivan Pomaleu, Secretary for Department of Communication and Information Technology Mr Steven Mataihano, High Commissioner to the Philippines Ms Betty Palaso, including Chief Executive Officer of Road and Traffic Authority Mr Nelson Terema, amongst others.
• According to Treasury Minister, Ian Ling-Stuckey, the COVID-19 pandemic will cost the country a total K1.8b over the next 3 years, i.e. K600m annually. This impact on the budget has been integrated in the medium-term fiscal framework. Mr Ling Stuckey said the framework noted rapid drops in the size of the national budget, a decline also in the national deficit from 9.0% of Gross Domestic Product (GDP) when the global pandemic hit to 7.3% this year, down to 2.1% by 2024. This framework sees a turnaround in the country’s debt-to-GDP ratio from 51.5% this year to 50.5% in 2025 and hopefully declining thereafter.
• Moody’s, an international credit rating agency, recently changed its stance on the PNG Government’s B2 rating from “stable” to “negative” this was attributed to decline in the country’s economic strength and debt position and high borrowing requirements. Although the negative rating will have an impact on how PNG is viewed by (offshore) lenders, PNG’s continued B2 rating reflects Moody’s assessment that PNG also has upside potential, mainly because of the country’s resources sector.
• Petroleum Minister Kerenga Kua is confidence that the outlook for the industry is positive with global oil prices still high. It is currently more than US$60 (K207.63) a barrel. He said the Covid-19 pandemic still a threat to the industry. But in terms of the PNG LNG project, operator ExxonMobil PNG Ltd adopted a professional approach to deal with the issue.
• Bank South Pacific Financial Group Ltd (BSP) has introduce a new digital payment service called BSP Pay. According to BSP Digital General Manager Nuni Kulu the system allows customers to make online payments securely and instantly without the use of card details. The BSP No Card Just Pay is a first of its kind in Papua New Guinea and the Pacific, which offers customers an affordable online payment service to pay for products on any registered BSP Pay merchant’s website hence, this will motivate growth in the e-commerce space and provide a suitable offering for the business community, starting from SME to large corporations.
• Air Niugini Limited (ANL) has confirmed to additional changes for international travel this week in which passengers departing internationally will be required to be tested for Covid-19 at the time of check-in. Furthermore, ANL have engaged International SOS to conduct the testing at no cost to passengers however they must be available between two and four hours prior to their scheduled flight departure as tests take 45 minutes to be completed. Passenger will be unable to travel if tested positive at check-in however, Air Niugini will automatically re-book their travel for a future travel date at no cost.
• This month’s auction in Government Inscribed Stock were undersubscribed by K23.22m from the total K1.0b offered. Series offered were S15022023 – Covid-19, S15052024-Covid-19, S15082026-Covid-19, S15082027-Covid-19, S15082029-Covid-19, S15112030-Covid-19 and S15022031-Covid-19 with their weighted average yields at 8.50%, 0.0%, 9.98%, 10.50%, 0.0%, 11.92% and 12.44% respectively.
• This week’s Treasury Bill overall auction results was undersubscribed by K60.130m from the total K143.04m offered. The weighted average yields for 182 days was down by 0.01points to 4.38%, while 273 days 364 days remained unchanged at 6.04% and 7.20% from the last auction. There were nil offers for 63 and 91 days.
• The Kina Securities Index rose 0.1% to 6,108.53 while the Kina Securities Home Index remains unchanged at 13,331.98 points

• The Bank of PNG (BPNG) released the bi-annual Monetary Policy Statement (MPS) and the general view of the economic growth was struggling largely due to negative impact of the pandemic and SOE restrictions put in place which affected a lot of business activities in PNG. The government amended the Central Bank Act to increase the advance facility limit from K300 million to K1.5 billion as a means of assisting the government with its cashflow difficulties during 2020 up to now. According to the Central Bank Governor, Loi Bakani, this substantial increase in the advance facility limit has posed challenges to monetary policy management. Key projections for 2021 in the MPS include, CPI inflation of 4.5%, gross international reserves of K8.9 billion, total import cover of 6.7 months, GDP growth of 2.5% and Budget Deficit of K6.6 billion.
• The Minister for ICT, Timothy Masiu, announced that a new mobile network carrier will be coming to market by end of this year. Digitech Communications Limited (Digitech) will be rolling out its communications network in preparation for launch this year. Minister Masiu said that a third mobile network operator will bring much needed competition to the communications industry which could benefit consumers in PNG. The Minister also added that with Digitech coming to market, their presence could trigger regulated tower sharing pricing and mobile number portability in the following year.
• The Independent Consumer Competition Commision (ICCC) announced that they have received an authorization application from Kina Securities Limited (KSL) on its proposed acquisition of Westpac’s Pacific business. The CEO for ICCC, Paulus Ain said that their final determination would come after they assess the impact on competition and benefits that could come from this acquisition. This will be done through public consultation process where submissions from stakeholders and the general public will be reviewed before a decision is made under the ICCC Act.
• Ok Tedi Mining has pledged K20 million to help PNG curve the current COVID-19 wave. Ten million kina will be given to the Port Moresby General Hospital and the other K10 million will help in the procurement, distribution and rollout of the COVID vaccine in Western Province.
• In an interview with Business Advantage, Toyota Tsusho PNG (Ela Motors) spoke of the impact of the pandemic on its core operations and what the vision is for Ela Motors during this difficult economic times. Ela Motors CEO, Mitsuyoshi Okutu said that the restrictions and new measures put in place by SOE controller has prompted the business to invest in its digital capacities to continue maintaining its relationship with clients by upgrading their website and developing online communication with customers through the Simple Notification Service (SNS) stream. Ela Motors has also developed new procedures to deal with covid19 transmission and ensuring business continuity. Operations will see new dealership facilities in Lae and Goroka while existing sites are being planned for redevelopment.
• The Nasfund Contributors Savings and Loans (NCSL) has announced the results of its 2020 financial year. NCSL total assets are K256.8 million – 11.3 per cent more than the previous year. Total revenue increased 13.9 per cent to K32.2 million and, despite 2020 being a turbulent year for employees, member’s savings increased 11.2 per cent to K219.5 million.
• Nambawan Super Limited (NSL) announced their financial results this week stating a net profit of around K89 million for 2020 financial period resulting in a crediting rate of 1.0%. NSL Chairman, Reg Monagi said that the fund returns were severely affected by the covid19 pandemic which saw difficult economic conditions that negatively impacted valuations on its key investments in PNG; including SP Brewery, OPH properties and Westpac PNG. Key highlights for the year include; net asset value of K8.1 billion, net profit of K89 million, 1.0% interest crediting rate, total member contributions of K893 million and fund membership of 207,986.
• This week’s Treasury Bill overall auction results was undersubscribed by K12.62m from the total K235.9m offered. The weighted average yields for 182, 273 and 364 days remained unchanged at 4.39%, 6.04% and 7.20% from the last auction. There were nil offers for 63 and 91 days.
• Both Kina Securities Index and Kina Securities Home Index remained unchanged from the prior week at 6,104.61 and 13,312.29 points respectively

• Minister for Agriculture and Livestock, John Simon told farmers in East New Britain to produce quality cocoa. MP Simon visited the province to inspect a number of projects under his department. He told the farmers that for the price support programme to continue farmers must maintain the quality of cocoa.
• Commissioner General for the Internal Revenue Commission (IRC) Sam Koim, announced that IRC will soon de-group major businesses that have branches operating nationwide thus requiring them to pay tax directly to the governments of the provinces where they operate. IRC is currently undergoing a tax payer mapping exercise that will aid in the de-grouping exercise, Mr Koim noted that this will go a long way in providing incentives to the provincial governments in collecting Goods and Services Tax (GST).
• According to World Bank PNG, the Covid-19 pandemic impacted Papua New Guinea’s external sector through dropping export earnings, however import density and surging gold prices contained the damage.
  The current account surplus widened in the first half of 2020, increasing by 14.0% year on year supported by a strong produce trade performance. It stated that although prices for major exports recorded substantial declines, earnings from the mining sector notably gold exports sustained a sizeable trade surplus.
• Mineral Resources Development Company (MRDC) Managing Director (MD) Augustine Mano said oil price is above US$60 (K207.90) and looks promising this year. In the latter year, the oil price average was at a historical low and on average for the year around US$32 (K110.88). It will be a strong recovery for the MRDC group.
• Noting the constant depreciation of the PNG Kina (PGK) against global currencies, Bank South Pacific (BSP) Group Chief Executive Officer (CEO) Robin Fleming said the PGK exchange rate was largely determined by the US dollar and the consequence of other currencies against the US dollar. Hence, the cost of importing items into the country will increase in the coming months if the US dollar does not regain strength against global currencies. The basket of currencies that determines the PGK exchange rate is largely weighted to the US dollar and as a consequence if other currencies such as the Australian, Singapore and New Zealand dollar  appreciate against the US dollar, that would result in those currencies also becoming stronger than the PGK. 
• Newcrest Mining Limited (NCM) revealed that it had renewed its unsecured bilateral bank lending facilities with its existing 13 bank lenders, extending the maturity dates. Each bank committed approx. US$154m in facilities for an overall steady quantum of US$2.0b on similar commercial terms for NCM.
• Additionally, NCM announced a dividend of AU$0.19 (PGK0.53) payable on 25 March 2021.
• Oil Search Limited (OSH) announced the appointment of Peter Fredricson as Chief Financial Officer (CFO) effective 23 March 2021. Mr Fredricson replaces Stephen Gardiner, whom served the company for the past 8 years after stepping down from the role of CFO. Mr Gardiner will continue to support OSH as adviser to its Managing Director and will also assist with the handover to Mr Fredricson on a transitional basis. Prior to this, he was the CFO of APA Group, an ASX-listed energy infrastructure company, for over 11 years. Mr Fredricson brings to the company over 30 years of international experience in the infrastructure, financial services, investment, and merchant banking sectors across Australia, New Zealand and Asia.
• This week’s Central Bank Bill overall auction was oversubscribed by K28.0m from the total K24m offered. The weighted average yield for 91 days was 2.04% a drop of 0.01% from the last auction. There were nil offers for 28, 63, 182, 273 and 364 days
• This week’s Treasury Bill overall auction results was undersubscribed by K82.12m from the total K287.12m offered. The weighted average yields for 182 days decrease by 0.01% to 4.40% whereas 273 and 364 days remained unchanged at 6.04% and 7.20% from the last auction. There were nil offers for 63, 91 and 273 days.
• Both Kina Securities Index and Kina Securities Home Index remained unchanged from the prior week at 6,105,19 and 13,312.29 points respectively

• The Somare family announced that the Statesman and the Founding Father, Grand Chief Sir Michael Thomas Somare has passed away at the Pacific International Hospital in the nation’s capital. His family in a statement said that Sir Michael was only diagnosed with a late stage of pancreatic cancer in early February and was admitted to hospital on Friday 19 February 2021 until his passing. His political career spanned half a century from 1968 until his retirement in 2017. He has been the longest serving Prime Minister (17 years). He has been minister of foreign affairs, leader of opposition and governor of East Sepik Province. The family said that late Sir Michael would be taken home to his final resting place in East Sepik Province in due course.
• The consultation of tax revenue is currently underway with officials from various State Entities have been meeting to discuss and present views on the bill. According to Finance Secretary Dr Ken Ngangan, the bill will be presented to National Parliament on the April 2021 sitting. The Non-Tax Revenue Administration Bill 2021 is the replacement Bill to the Public Money Management Regularization Act that the Supreme Court ruled against in May 2020.
• Kina Securities Limited (KSL) recorded a statutory net profit after tax of K76.0m, up by 25.0% for the full year 2020. Foreign exchange income up 32.0% to K55.2m, net interest income and non-interest income up 48.0% and 59.0% to K1.69.7m and K145.1m respectively, while revenue up 53.0% to K314.8m. Capital adequacy up 18.0% to 23.8% compare to previous year.
• Following the announcements of full year results, the Directors of KSL have declared a final unfranked dividend of 16.9 toea (6 cents) per share bringing the total dividend for full year to 26.9 toea (10.0 cents). The company’s share will trade ex-dividend on Tuesday March 2021 and payable to the shareholders on Friday April 2021.
• Bank South Pacific Limited (BSP) announced a net profit after tax of K806.2m for the financial year ended 31 December 2020. The result was 9.5% lower compared to the prior year was attributed to increase in impairment expenses to K201.3m due to the impact of Covid’19 across the Group. Total Group revenues decreased by 1.2%. Revenues across the Group from foreign exchange income declined by K39.5m. Despite the challenges, BSP continued to achieve a reasonable portfolio growth with customer loans and advances increasing by K449.0m to K14.4bln. The Group’s capital base remains solid. Total capital adequacy stood at 23.2% for the financial year 2020.
• Oil Search (OSH) Group’s revenue declined by 32.0% for the full year ended 31 December 2020. The company recorded a net loss of US$320.7m due to lower realized hydrocarbon prices in 2020. Core net profit after tax fell by 93.0% compared to previous corresponding period. Free cashflow up 122.0% for the year. Despite fell in revenue, the Board of the OSH have declared the payment of final unfranked dividend of 0.5 US cents per share. OSH trades ex-dividend on 2 March 2021 and payable to shareholders on 25 March 2021.
• OSH also announced the front-end engineering and design entry for Phase 1 of the Pikka Project in Alaska after completion of feasibility study. Phase 1 will include a single drill site and a production facility with 80,000 barrels of oil per day capacity commencing in 2025. The expected cost for Phase 1 would be approximately US$3.0 bln and produce oil at a break-even cost of supply of less than US$40.0 per barrel Brent inclusive of a 10.0% return.
• This week’s Central Bank Bill overall auction was oversubscribed by K34.0m from the total K169.0m offered. The weighted average yield for 63 and 91 days was 2.04% each. There were nil offers for 28, 182, 273 and 364 days
• This week’s Treasury Bill overall auction results was undersubscribed by K70.83m from the total K392.56m offered. The weighted average yields for 273 and 364 days remained unchanged at 6.04% and 7.20% from the last auction. There were nil offers for 63 ,91 and 182 days.
• The Kina Securities Index fell by 0.02% to 6,103.54 points due to drop in share price of OSH, while the Kina Securities Home Index remained unchanged to end the week at 13,312.29 points.

• During the launching of the Central Provincial Plan, Hon. Prime Minister (PM) James Marape has urged the Central Government to work with the National Capital District Commission in addressing land boundary issues. The National Government will provide Central Province with K10.0m to set up border posts. The Government also committed K5.0m to the province and advised the Central Province Governor Hon. Robert Agarobe and his Government to encourage the people of Central to register their land.
• The Australia PNG-2 (APNG 2) submarine cable was decommissioned after 15 years of service. The retirement of the APNG2 submarine cable system described as an umbilical cord between Australia and Papua New Guinea (PNG) marks the end of an era of telecommunication development in the country. According to Minister for State Owned Enterprises Hon. William Duma, the APNG2 was a classic example of a solid and long lasting partnership and friendship between PNG and Australia. The decommissioning of APNG2 cable means PNG has transformed and now have a modern cable infrastructure with improved electronic systems and ample capacity to meet current and future voice and data requirements. The government of PNG is grateful with the Government and people of Australia for their continuous assistance to the people of PNG.
• Telikom Holdings Limited (KTHL) has appointed a new Chairman of it board as Mr. Johnson Pundari as confirmed by the State Enterprises Minister William Duma last Friday. Mr Pundari was appointed by Cabinet in November 2020 and took office in December. He holds a master’s in business administration from Torrens University, Australia and has 15 years of private sector experience having worked with ExxonMobil before joining IBBM, in which he is an executive director and is also a director of the National Fisheries Board. Mr. Pundari was the former deputy Chairman of KTHL and now replaces outgoing chairman Rueben Kautu.
• National Superannuation Fund (Nasfund) Chief Executive Officer (CEO) Mr. Ian Tarutia has stated that the new taxation arrangement for Bougainville requires to be carefully considered as it has consequences. During the Joint Supervisory Body (JSB) meeting in Arawa in February, one of the nine resolutions passed was that the Autonomous Bougainville Government will receive 70% of the tax collected in the region. Previously it collected only 30% while the PNG Government collected 70%. Other provinces may seek similar concessions.
• Nasfund CEO Ian Tarutia has welcomed the signing of the Papua LNG fiscal stability agreement. Nasfund had seen a 22% increase in member savings withdrawal last year and the signing ceremony is a step in the right direction in bringing back confidence, new investment opportunities and membership growth in the country. Mr Tarutia commended the Government and relevant stakeholders for bringing everything together so far.
• K1.0m has been paid as dividends to landowners from Kutubu and Moran for the 2019 financial year by landowner company Kutmor. The dividend paid covers people from the PDL2 (PETOLEUM LICENCE), PDL5 and PDL6. Due to COVID-19 that had affected business last year the company had to let go of staff because of changes to the way the company worked, however the acting General Manager Mr. Nathan Nason is confident 2021 will be a better year for business.
• The Steamships Trading Company Limited (SST) has invested over a billion-kina worth of investment in the past recent years. According to Managing Director Mr. Rupert Bray, SST has another K1.0b worth of investments in the pipeline for its large property projects in the country, which will be announced soon.
• This week’s Central Bank Bill overall auction was undersubscribed by K5.3m from the total K185.0m offered. The weighted average yield for 28 days remained unchanged at 1.33% from the last auction. There were nil offers for 63, 91, 182, 273 and 364 days
• This week’s Treasury Bill overall auction results was undersubscribed by K140.83m from the total K436.58m offered. The weighted average yields for 182, 273 and 364 days all remained unchanged at 4.41%, 6.04% and 7.20% from the last auction. There were nil offers for 63 and 91 days.
• Both the Kina Securities Index and Kina Securities Home Index remained unchanged to end the week at 6,104.61 and 13,312.29 points respectively.

• The employment index from Bank of PNG (BPNG) shows that the level of employment in the formal private sector declined by 5.5% in the September quarter of 2020, compared to an increase of 1.3% in the June quarter. This was highlighted in BPNG’s quarterly economic bulletin for last September quarter released recently. BPNG Governor Loi Bakani said without the mineral sector, the level of employment chopped by 1.4%. By sector, the level of employment dropped in all the sectors except the financial/business and other services and the wholesale sectors he said. By region, the level of employment fell in the Highlands, Mamose (excluding Morobe) and Southern, excluding National Capital District, while it increased in Morobe.
• The Independent Consumer and Competition Commission (ICCC) announced an upturn in fuel prices for the month, effective 8 April 2021. Petrol, diesel and kerosene retail prices will all increase on average throughout PNG as a result of rise in crude oil price during the month of March 2021 as the global oil market reacted to lower crude oil production from OPEC and partner countries. Consequently, fuel prices in Port Moresby for petrol, diesel and kerosene will bump up to K3.50, K2.99 and K2.66 per litre, respectively.
• Papua New Guinea Securities Commission recently introduced a new levy on all transactions on the country’s stock market, PNG Stock Exchange (PNGX). Chairman of PNGX, David Lawrence advised that the Securities Commission had introduced this new levy in February 2021 and it went effective on 8 March 2021. Each buyer and seller were required to pay an additional 0.75% of the transaction value to their stockbroker, of which the stockbroker is then required to pay to PNGX monthly and consequently, PNGX was then required to pay it to the Securities Commission monthly.
• Kina Bank Limited’s (KBL) Chief Executive Officer Greg Pawson, said that if the proposed acquisition of Westpac Bank’s Pacific business is approved, the bank will have a new name separate from KBL and will operate separately as well with the aim to improve competition in the banking sector and customer choice. KBL’s strategy was to create a newly-branded PNG bank, independent and separate from Kina that would interrupt the banking sector in a positive way. Mr Pawson further added that the newly-branded bank will be governed by an independent PNG-based board of directors as well as maintain the independent commercial banking license of Westpac PNG.
• Additionally, KBL will be debut its new product called the “Kina everyday account” for new and existing customers that will not have a monthly account maintenance fee. The bank said they removed EFTPOS fees for Kina bank EFTPOS terminals. The key features of the new account will include: No monthly charges, No EFTPOS fees when using Kina Bank EFTPOS terminals and minimum opening balance of just K10. The bank said its existing customers could apply for a “Kina everyday account” via internet banking and visit their home branch to collect their card.
• Kina Securities Limited announced its Annual General Meeting will be held via virtual meeting on 26 May 2021 at 10:00am, in addition the closing date for receipt of nominations from persons wishing to be considered for election as a Director is 14 April 2021
• The Bank of PNG announced that the Kina Facility Rate for the month of April 2021 will be maintained at 3.00%.
• This week’s Treasury Bill overall auction results was oversubscribed by K122.1m from the total K198.7m offered. The weighted average yields for 182 days dropped by 0.01pt to 4.38%, while 364 days remained unchanged at 7.20% from the last auction. There were nil offers for 63, 91 and 273 days.
• Both Kina Securities Index and Kina Securities Home Index remained unchanged for the  week at 6,104.61 and 13,312.29 points respectively.

• Prime Minister (PM) Hon. James Marape announced the signing of the Fiscal Stability Agreement (FSA) between the Independent State of Papua New Guinea and the Papua LNG Project, and joint venture partners ExxonMobil and Oil Search. The signing is a key milestone highlights the commitment of PNG government towards the Papua LNG and is a significant step in de-risking the project. The milestone also demonstrates increasing alignment between the PNG Government and the joint venture partners.
• The Independent Consumer and Competition Commission (ICCC) announced an upturn in fuel prices for the month, effective 8 February 2021. Retail prices for petrol, diesel and kerosene will increase on average throughout PNG as a result of crude oil price increase during the month of January 2021 due to the demand of heating oil and tighter global supplies by Saudi Arabia. Consequently, fuel prices in Port Moresby for petrol, diesel and kerosene will rise to K3.17, K2.72 and K2.41 from K2.99, K2.60 and K2.30 respectively.
• Chairman for Nambawan Super Limited (NSL), Mr. Reg Monagi announced the appointment of David Kitchnoge as the new Chief Investment Officer (CIO) to the Fund. Mr. Kitchnoge is a knowledgeable and well-respected professional with nearly 20 years of experience in the country’s financial sector. Subsequently, Mr Kitchnoge had been appointed last year as Deputy CIO for the purpose of “upskilling and knowledge transfer through a well-managed transition”, prior to joining NSL he was previously employed as Head of Research and Advisory with Kina Funds Management Limited, the current licensed investment managers for NSL. Mr. Monagi also thanked the outgoing CIO Dominic Beange whom had worked for the Fund for the past 2 and half years, initially as a consultant before being appointed CIO.
• The foreign exchange liquidity in the country is expected to improve this year although it will remain tight in the first quarter, according to the Bank South Pacific (BSP).Group general manager treasury Mr. Rohan George highlighted in the BSP Economic and Market Insight December 2021 quarter publication that the foreign exchange inflows were expected to fall by 13 per cent with the support of the Bank of PNG (BPNG) (forex) intervention and 20 per cent without its forex support, from levels enjoyed in the last quarter of 2020. He forecast that the reduced forex inflows from the Porgera mine shutdown, the effect of the fire at Ok Tedi, Government businesses and State-owned entities strong end-of-year inflows are likely to be partially offset by increased forex intervention by the Bank of PNG”.
• The Teachers Savings and Loans Society Limited (Tisa) subsidiary Tisa Community Finance Limited has applied for a banking licence to the Bank of PNG. Group Chief Executive Officer Mr. Michael Koisen says that BPNG is currently assessing their application and Tisa is working with BPNG in facilitating the assessment process. Mr. Koisen further mentioned that the country needs another local bank and Tisa is prepared to step up to meet that need. “On the group’s performance, Koisen said: despite the impact of the Covid-19 pandemic our operational and financial performance continues to remain strong with our savings and loans books rapid growth. Thus, the organisation has made some significant re-investment into the business, including upgrading our core banking system, processes and people whilst addressing the needs of our members. We plan to introduce some new digitalised platforms to serve our members. Tisa also intends to extend its services and membership to the private sector employees.
• The Newcrest Mining Limited (NCM) board approved a new dividend policy that retains the minimum dividend of US$ 15 cents per share. The new dividend policy targets 30-60% of annual free cash flow to be paid in dividend. The interim dividend is fully franked and is 100% higher compared to previous year.
• Kina Securities Limited (KS) announced it will host an Extraordinary General Meeting (EGM) to be held via virtual online on 11 March 2021 at 10am.
• This week’s Treasury Bill overall auction results was undersubscribed by K173.11m from the total K399.61m offered. The weighted average yields for 182, 273 and 364 days all remained unchanged at 4.41%, 6.04% and 7.20% from the last auction. There were nil offers for 63 and 91 days.
• The Kina Securities Index rose 0.5% to 6,102.46 while the Kina Securities Home Index remained unchanged at 13,312.29 points respectively.

International

• U.S.-based stock funds attracted $22.9 billion in the week to Wednesday, the largest weekly inflow since March 2008, as Wall Street’s main indexes hit record highs on optimism about President Joe Biden’s plans for fiscal stimulus and COVID-19 vaccine distribution.
• Australian shares slipped on Friday, weighed by energy and gold stocks, as U.S. President Joe Biden’s comments on China stoked worries that relations between the two nations could sour further.
• European shares edged higher on Thursday, still on track to end the week flat, as investors kept close watch on a barrage of earnings reports from companies for clues on the pace of business recovery. The pan-European STOXX 600 index was 0.1% higher in early trading, with most of its sectors trading in the positive territory.
• Asian shares hovered just below a record high on Friday as mixed U.S. economic data caused some investors to show restraint after a global stock market rally pushed many bourses to dizzying heights.

• Agreements for three multi-billion kina resource projects are expected to be signed soon. Prime Minister (PM) Hon. James Marape  during the 2021 Prime Minister’s business breakfast thanked the investors of the US$5.4 bil (K18.49 bil) Wafi-Golpu copper and gold project, US$13 bil (K44.5 bil) Papua LNG project and the US$525 mil (K1.7 bil) for the Pasca-offshore oil and gas project. The PM stated that the projects will be aligned within the existing legislative regimes.
• Ramu Nico company president , Mr Goa Yongue has stated that productivity must remain as priority for the nickel cobalt mining project. Key areas outlined for 2021 were to improve productivity, stability, reducing costs and increasing efficiency. Furthermore, with the world markets decline it is advisable for the mining project to take advantage of the scale cost and overcome adverse impact on the weakening ore grade.
• Telecommunications wholesaler PNG DataCo Limited, plans to upgrade its Kumul submarine cable bandwidth to cater for the huge increase in internet data transmission use. General Manager Engineering, Mr. Tony Morisause confirmed that businesses are now realising the importance of data transfer and when weighted out DataCo has increased the country’s capacity.
• The National Development Bank Limited (NDB) appointed a new acting CEO, Mr. Gary Coplin following the resignation of Mr. Aaron Underdown last December. NDB Chairman Michael Mell and the Board look forward to working with Mr. Coplin and the NDB team in rolling out the K80m for MSME loans.
• Members of Nambawan Super Limited (NSL) and National Superannuation Fund (Nasfund) will now be able to purchase products from Brian Bell at a 30% discount through its ‘double discount’ promotion. Brian Bell group CEO Mr. Cameron Mackellar said the promotion had been running for four years and they were pleased to partner with both Nasfund and NSL.
• According to Kina Bank’s Executive General Manager for Banking Ms. Lesieli Taviri, the recent acquisition of Westpac’s Pacific businesses in the country and Fiji should be seen as an opportunity to enhance local investment and reiterate Papua New Guinea (PNG) as the major economy driver in the Pacific Region. Moreover, Kina aims to create a completely new brand for the acquired business which will also maintain the independent commercial banking licence of Westpac PNG.  Ms Taviri stated that the bank had a bold ambition to create the “bank of the future” for the country in order to create exceptional banking and financial services in PNG and the broader Pacific.
• Furthermore, Kina Bank clarified the status of its ownership and stakeholders saying that it is a publicly listed company on the Australian Stock Exchange and PNG Stock Exchange and that its founding shareholder, Fu Shan Investments have sold their remaining Kina Securities Limited shares in 2018 thus giving access to local PNG Investors such as Comrade Trustees Services and MRDC to invest.
• According to Bank South Pacific (BSP) Limited CEO Mr Robin Fleming, reported that the Kina depreciated its value by 2.9% against the US dollar (USD) in 2020 while the Australian dollar (AUD) appreciated by 16%. This meant that the cost of goods imported in USD had increased by the depreciated margin while the AUD imports was much higher predominantly due to movements in the USD and AUD cross rates. 
• Credit Corporation PNG Limited (CCP) has announced the resignation of Mr. Peter Aitsi as its Chief Executive Officer at the completion of his term and will leave the Group on 31 March 2021. The CCP Board have appointed the Chief Operating Officer, Mr Danny Robinson to act as CEO while an executive search is conducted for the new permanent CEO. Additionally, CCP Director Mr. Michael Varapik has tendered his resignation from the Board and its subsidiaries effective immediately. CCP Chairman Mr. Syd Yates expressed his appreciation to Mr. Varapik for his contributions during his tenure and wished him well in his future endeavours.   
• There were no Central Bank Bills auction for the week.
• The week’s Treasury Bill overall auction was undersubscribed by K193.65m from the total K366.50m offered. The weighted average yields for 182, 273 and 364 days all remained unchanged at 4.41%, 6.04% and 7.20% from the last auction. There were nil offers for 63, 273 and 91 days.
• The Kina Securities Index rose 0.3% to 6,071.75 while the Kina Securities Home Index remained unchanged at 13,312.29 points respectively.

• According to General Commissioner for Internal Revenue Commission (IRC) Sam Koim, IRC intends to make Goods & Services Tax (GST) as its main tax revenue earner. Currently the top revenue collection was from salaries and wages taxes (SWT) with over K3.0b collected in 2020, which resulted in the organization exceeding its initial K2.7b target. Mr Koim stated that IRC’s goal now is to ensure that the entire PNG population participate in sharing the burden of funding the national and not just the working class. The objective is to make GST the country’s principal revenue earner and once all were paying their mandatory taxes the Government could then look at cutting down tax in other areas such as salaries and wages. 
• The Managing Director for PNG Power Limited (PPL) Mr Flagon Bekker confirmed that they are working with donor agencies to improve the Port Moresby transmission and distribution systems. In a recent statement released, Mr Bekker stated that they are unable to bring in experts with the skill set for the tap changer at this time however, believes that by the end of March the power outages should end. PPL is now working with significant stakeholders to find a way to bring in a new transformer. Currently the organization is dealing with old equipment thus costing them hundreds of millions of kina.
• Oil Search Limited (OSH) released its fourth quarter report ended 31 December 2020 recording a total net production of 29.0mmboe, up 4.0% from 2019 with revenue of US$259.5m (K935.1m), up 37.0% from the prior quarter. Managing Director Dr. Kieran Wulff noted that OSH had produced another solid quarter, resulting in record annual PNG LNG production against a backdrop of recovering commodity prices. OSH attention to performance, cost and capital allocation endured to bring results in the fourth quarter, driving maintainable cost reduction initiatives and enhancing operations across the company to boost improved performance over the longer term.
• According to Bank South Pacific (BSP) Limited, foreign currency availability from the export market this month has been lower than the same period last year. The Bank of Papua New Guinea (BPNG) had entered the market on 14 January 2021 with a large intervention of US$100.0m (K346.8m) which assisted with supply of foreign currency to importers and retail customers. BSP’s Group Chief Executive Officer (CEO) Mr. Robin Fleming said the bank’s total orders for foreign currency for this year is lower compared to the same period in 2020. There is still imbalance between export flows and import demand, but the situation has improved over the past 12 months.
• Additionally, Mr. Fleming confirmed that the quality of notes used to replenish the BSP Automated Teller Machines (ATM’s) must be of quality in order to prevent note jams that could result in an ATM going off-line. This comes after a shortage of cash was encountered in all BSP ATM’s in Port Moresby last week. BSP further urged businesses in Port Moresby to deposit their cash regularly to improve the supply and circulation of cash.
• The possible sale of Digicel Pacific has attracted considerable interest among security experts in Australia. Selling off Digicel Pacific business was due to a significant concern regarding the sustainability of its operations in the Pacific is the substantial burden of debt held by the parent company, Digicel Group. 
• Moreover, Reuters reported that Digicel Group had offered its Pacific business as security to its creditors in a restructure that reduced its debt. Within the Digicel Pacific portfolio, the PNG operations are the largest in terms of number of subscribers and towers. Potential buyers would be eyeing the PNG part of the company with interest. The Australian government, supported by interested allies, could productively discuss opportunities for modern communication with the region’s governments and regulatory authorities.
• This week’s Central Bank Bill overall auction was oversubscribed by K53.2m from the total K64.8m offered. The weighted average yield for 91 days dropped 0.1pt to 2.03% from the last auction. There were nil offers for 28, 63, 182, 273 and 364 days.
• The week’s Treasury Bill overall auction was undersubscribed by K126.5m from the total K430.5m offered. The weighted average yields for 182, 273 and 364 days all remained unchanged at 4.41%, 6.04% and 7.20% from the last auction. There were nil offers for 63 and 91 days.
• Both the Kina Securities Index and Kina Securities Home Index remained unchanged at 6,051.25 and 13,312.29 points respectively.

• The PNG National Statistics Office released its September quarter CPI report and the result for the period saw CPI inflation for the quarter at 0.6% and for the 12months to September 2020 was 5.8%. According to the report, the biggest CPI increase for the quarter and rolling year was seen in the Health group due to sharp increase in medical fees by 25.2% given the current pandemic. The second biggest CPI increase was seen in the Restaurants & Hotels group largely due to increase in fast food prices and hotel accommodation rates. Meanwhile, Communication group decreased due to drop in mobile prepaid rates. And the Transport group saw a decrease in the quarter due to drop in fuel prices and travel fares by 4.0% and 4.2% respectively. 
• The Independent Consumer and Competition Commission (ICCC) announced an upturn in fuel prices for the month, effective 8 January 2021. Retail prices for petrol, diesel and kerosene have increased on average throughout PNG as a result of crude oil price increase during the month of December 2020 due to the uplift of lockdowns following the second wave of COVID-19 which led to growing oil demand from Asia. Consequently, fuel prices in Port Moresby for petrol, diesel and kerosene have rose to K2.99, K2.60 and K2.30 from K2.83, K2.42 and K2.10 respectively.
• K92 Mining Inc, the operator of Kainantu Gold Mine in Eastern Highlands paid a corporate tax of K25.0m for 2019/2020 following its commercial production. Senior vice-president operations Mr Warren Uyen said,” COVID-19 had also impacted the mine’s operation however measures were taken seriously and the employees seemed to manage well.”
• Paradise Company Limited (PCL) was given the clearance by ICCC to proceed with its proposed acquisition of shares in Hugo Canning Company Limited (HCCL). The proposed acquisition required ICCC’s approval as the transaction value was over K50.0m. According to PCL’s Chief Executive Officer Mr James Rice, this only meant that PCL was given the allowance to purchase HCCL, however they are still reviewing their business and yet to make a final decision.
• The National Superannuation Fund (Nasfund) has partnered with Air Niugini Cargo and The Stanley Hotel in its membership discount programme. Nasfund contributors will now receive a 10% discount at Air Niugini Cargo and a 5% discount on food and beverages at The Stanley Hotel’s restaurants and bars.
• ExxonMobil has appointed Mr Peter Larden as the new Managing Director for ExxonMobil Papua New Guinea replacing Mr Andrew Barry. Mr Larden served as the president of ExxonMobil Canada Limited before his appointment. Mr Barry moves to become the vice president of Global LNG Marketing for ExxonMobil in Singapore and takes on the responsibility of liquefied natural gas marketing activities around the world.
• Ms Vicky Vene was appointed as National Development Bank’s (NDB) Chief Financial Officer. Ms Vene was NDB’s Financial Controller before her appointment. She holds a master’s in professional accounting from the Central Queensland University of Australia and is a PNG Certified Practicing Accountant. Ms Vene looks forward to her new role and aims to add value and surpass expectations in NDB.  Apart from internal reporting, she planned to provide accurate reports to Kumul Consolidated Holdings Limited and stakeholders in a timely and efficient manner.
• Group Chairman to Capital Insurance Group of Companies Mr Michael Koisen has appointed Mr Jeremy Norton for the role of Chief Operating Officer. According to Koisen, “Mr Norton has a strong technical, commercial and leadership background with more than 20 years of insurance industry knowledge across a range of disciplines in both life and general insurance abroad and locally. The board of directors have every confidence in Mr Norton to contribute towards the group and its subsidiaries through its next phase of growth and strategy.”
• According to Bank South Pacific Limited’s (BSP) Chief Executive Office Mr Robin Fleming, the bank has approved K14.2m loans under the Small-Medium Enterprise (SME) Credit Enhancement Scheme and funded K6.5m worth of loans. The same loan underwriting standards apply for the SME loan however the interest is lower.  Further, BSP has received just over 200 applications for finance since the scheme commenced, 67 have been approved, 44 of approved loans have been funded, 42 applications are pending additional information and the balance have been declined.
• This week’s Central Bank Bills auction was undersubscribed by K75.0m from the total K260.0m offered. The weighted average yield for 28 days remained unchanged at 1.33% from the last auction. There were nil offers for 63,91, 182, 273 and 364 days.
• The week’s Treasury Bill overall auction was oversubscribed by K135.7m from the total K308.4m offered. The weighted average yields for 182, 273 and 364 days all remained unchanged at 4.41%, 6.04% and 7.20% from last week. There were nil offers for 63 and 91 days.
• The  Kina Securities Index jumped by 0.1% to 6,051.25 points while the Kina Securities Home Index remained unchanged at 13,312.29 points.

• Prime Minister (PM) Hon. James Marape has announced that Cabinet has approved a five-day mourning period for the late senior statesman and former Prime Minister Sir Mekere Morauta. His body will lie in State at the Grand Hall at Parliament House for public to pay their respects on Monday, January 4. The funeral service will be held at the Sioni Kami Memorial United Church on Friday, January 8 between 10 am and 12 pm. He will be later laid rest at the Independence Hill beside the Parliament House.
• Governor Hon. William Tongamp has made it known that major road and infrastructure projects for Jiwaka Province will be completed. Governor Tongamp said there were two other projects being implemented under Asian Development Bank funding. The first is the Dona to Kerowagi highway and the second is the Minj to Kup highway. Furthermore, the Government has allocated K220m which K80m will go to start work on the four story provincial headquarters building.
• According to the Autonomous Bougainville Government (ABG) Finance Minister Hon. Mathias Salas, K390.0m budget has been passed for 2021. Meanwhile in a statement from ABG, the bulk of the 2021 budget was sourced from national government grants, totalling K320.0m whereas the remaining amount of about K27m and K45m would be obtained through the ABG internal revenue and re-appropriated funds respectively.
• Stated-owned organization The Motor Vehicle Insurance Limited (MVIL) gave K50.0m as dividend to Kumul Consolidated Holdings Limited (KCHL). KCHL Managing Director Mr Isikeli Taureka said “some portions of the fund would be given to Air Niugini after an evaluation”. According to Prime Minister Hon. James Marape, “MVIL was posting substantial yield, KCH will then support Air Niugini to ensure the airline is given enough input of liquidity to keep its operations running as we sail past 2020 and hopefully that should resuscitate its operations for a better 2021”.
• The Kokonas Industrial Korporesen programmes for Local Level Governments (LLG) have presented Copra farmers of the Uvol area in the Melkoi LLG of Pomio, East New Britain (ENB) with K5,000 funding to support agriculture programmes at the ward level. Melkoi LLG president Mr. Thomas Assa confirmed the Pomio District Development Authority (DDA) allocated K100,000 each to five LLGs in the district to support them with agriculture activities.
• The Papua New Guinea’s National Stock Exchange together with Australian Securities Exchange have been tasked to remove ordinary shares for the Kina Petroleum Corporation (KPE) from their official lists. KPE is proposing to use up AUS$1.3m (K3.5m) of its available cash resources to offer and undertake an off-market buy-back of its shares which would allow shareholders the opportunity to sell up to all of their shares to the company. A company statement confirmed that the significant drop in oil price and the COVID-19 overhang, there had been a number of significant changes to the PNG exploration landscape particularly in Western.
• Bank South Pacific (BSP) has appointed Mr. Frank Bouraga as one of its director after news was announced last week by the Board Chairman Sir Kostas Constantinou. Sir Kostas welcomed him to the board of BSP and acknowledged that the board of BSP was committed to appointing qualified Papua New Guineans on merit who meet the Fit & Proper assessment of Bank of Papua New Guinea and who had the necessary skills and experience to oversee and guide BSP’s future strategy.
• This week’s Central Bank Bills auction was oversubscribed by K39.0m from the total K53.0m offered. The weighted average yield for 91 days dropped to 2.04% from 2.07% from the last auction. There were nil offers for 28, 182, 273 and 364 days.
• The week’s Treasury Bill overall auction was oversubscribed by K81.25m from the total K293.13m offered. The weighted average yields for 182, 273 and 364 days all remained unchanged at 4.41%, 6.04% and 7.20%. There were nil offers for 63 and 91 days.
• Both the Kina Securities Index and Kina Securities Home Index ended the year flat by 6,048.35 and 13,312.29 points respectively.

Domestic

• Lady Roslyn Morauta announced that her husband, late Sir Mekere Morauta had passed away this during the week in Brisbane, Australia after battling cancer for some time. Sir Mekere served this country as prime minister from 1999 to 2002 and is greatly respected for his work as a reformist who helped turn this country around from the brink of collapse. Apart from his role as a member of parliament, Sir Mekere held prominent roles that were very key to the economy including Secretary for finance in 1975, MD of PNG Banking Corporation from 1983-1992 and Central Bank Governor from 1993-1994. Under his leadership as prime minister, Sir Mekere had stabilized the economy and laid the foundations of a better structured finance sector, especially in the banking and superannuation industries.
• Mayur Resources Limited has lodged its application to Mineral Resources Authority (MRA) for a mining lease for its Orokolo Bay Project in Gulf province. According to Managing Director, Paul Mulder, the Orokolo Bay Project is a near-surface mining and processing operation that requires no grinding or chemical processing. Capital cost is around US $20 million and funding has already been secured for the project and they anticipate no further dilution, with projected earnings profile looking attractive in the next couple years.
• A new option for smart office in meeting rooms, open offices, executive boardrooms, home offices and many other scenarios called Huawei ideahub was introduced by Huawei Technologies PNG Limited which Telikom PNG is the authorized distributor. The ideahub is a video conference and digital writing board device, incorporating intelligent handwriting, HD projection and open office app gallery.
• Bemobile Limited has upgraded its network which REDiSIM users will have access to 4GLTE network capabilities. Bemobile said the upgrade was implemented in three phases; first, Port Moresby and Lae residents who use a REDiSIM and have a 4G-compatible device have immediately accessed the 4G network nationwide; second, after Jan 6 2021, the rest of PNG REDiSIM users will begin to have access to the 4G network and; By the end of January 2021, all REDiSIM customers nationwide will have access to the 4GLTE network. Interim Chief Executive Officer Mr Anthony Pakakota said, “that this core network integration was part of the integral efforts and works towards achieving the merger and consolidation of the mobile business as part of the state owned enterprise Telco reform directives for the Kumul Telikom Holdings as set by the National Government to have one mobile network”.
• Postal and logistics company, Post PNG has paid a dividend of K1.5 million to Kumul Consolidated Holdings Limited, the holding company for the government. The company has performed well in challenging economic environment as the pandemic continued to affect many industries throughout the world. Post PNG continued its operations by helping to provide logistics services for the delivery of health and medical equipment and supplies as well as maintaining its postal services as well throughout PNG.
• Toyota will stop production at its British and French plants earlier than scheduled before Christmas because of chaos caused by the Covid’19 boarder closures. The Japanese carmaker said it was expecting shortages of parts as a result of transport delays, after France’s 48-hour ban on accompanied freight or cargo from Britain. Toyota said it decided to bring forward the planned seasonal stop at its engine plant at Deeside in north Walse and its factory at Burnaston in Derbyshire, where it makes the Corolla.
• CEO of Paradise Foods Limited, James Rice was pleased to announce that the company is looking to cut down on imports by localizing its products in PNG. Paradise Foods will now be producing its own ice cream cones in Port Moresby where previously the company had imported cones at a cost of K2 million per year. Mr Rice said that the reduction of imports will results in creation of more jobs for Papua New Guineans. The new production line continues to grow and the company hopes to provide more opportunities locally going forward.
• Bank South Pacific (BSP) entered a partnership with local SME, Tactical Ranger Systems (TRS) to launch an online payment system for SMEs specializing in ICT services and products. According to TRS director, Ricky Kirori, this partnership with BSP and will enable them to meet the goal to bridge the technology gap and reduce the complexities that SMEs faced in transacting securely and seamlessly with their customers via the BSP digital platform. TRS product line includes web design, development, hosting and software support.
• The week’s Treasury Bill overall auction was oversubscribed by K37.80m from the total K343.67m offered. The weighted average yields for 273 and 364 days remained unchanged at 6.04% and 7.20% while 182 days dropped to 4.41% from 4.43% from last week’s auction. There were nil offers for 63 and 91 days.
• Both the Kina Securities Index and Kina Securities Home Index ended the week flat by 6,048.35 and 13,312.29 points respectively.

Domestic

• Upon welcoming the move of 18 parliamentary members from the Opposition back to Government, Prime Minister James Marape made known his intention to appoint a revised cabinet line-up. PM Marape says he aims to restore a government structure which is truly representative of the diversity in the country. Also announced was the passing of the 2021 Budget again after court ruling and the adjournment of the next parliament sitting to 20 April 2021. James Marape has announced new look cabinet ministers for his government. Appointing Sam Basil as Deputy Prime Minister and also takes care of Commerce and Industry.
• Nambawan Super Limited (NSL) is encouraging employers to contribute more than the compulsory 8.4% for its employees which is called the “employer boost”. Chief executive officer, Mr. Paul Sayer said the tough conditions created by the global pandemic had forced employers to think about “how we manage people we care about who have become essential members of our teams or corporate families” thus the employer boost recovery package for employees.
• Following the payment of an interim dividend of PGK150m last September, Ok Tedi Mining Ltd (OTML) has declared its final dividend of PGK400m for 2020. According to Chairman Sir Moi Avei, in spite of the health crisis, “OTML has had a strong and profitable year and this has enabled the Company to complete the PGK800m self-funded investment in the Crusher Replacement Project, distribute PGK550m to our shareholders and retain a strong and debt-free balance sheet”.
• Newcrest Mining Limited (ASX, TSX, PNGX: NCM) has entered into a 15-year renewable Power Purchase Agreement with Tilt Renewables Limited (NZX, ASX: TLT) to secure a significant part of the future projected energy requirements of its Cadia Mine in New South Wales, Australia.
• Goodman Fielder (PNG) K10.29m rice plant, opened in Port Moresby, has the capacity of producing up to 360 tonnes of rice per day, general manager Manish Randev says. He said the company’s investment in this new plant for its Skel Rice brand showed their commitment to providing quality production, consistent deliveries and at an affordable price. The new rice plant created an additional 129 jobs on top of the existing 1,043 jobs. It would support growth in Central, Western, Gulf and Milne Bay and serve demand in the Southern region. Randev said there were three types of organization: one who witness the growth, the one who wanted to be part of the growth and the third one fuels growth.
• Coppermoly Ltd is pleased to announce that Jade Triumph International Limited (“Jade Triumph”) has agreed to further extend the maturity date for the Convertible Notes held by Jade Triumph for by twenty-four months to 19 December 2022.
• Kina Securities Limited (Kina or Company) is pleased to announce the appointment of Dr Ila Temu as an independent non-executive director. Dr Ila Temu is the Executive Director (PNG) of Barrick (Niugini) Limited (BNL), a role he has held for some time now, which places him as one of the senior Managers within BNL Management. Dr Temu has held various senior roles with Placer Dome Niugini since 2000 including General Manager Government Relations, Director Corporate Affairs and Country Manager Tanzania.
• Kina Asset Management (KAM) announcement “Net Tangible Asset (NTA) as at 30 November 2020” is at K1.54 per share.
• The week’s Treasury Bill overall auction was oversubscribed by K62.19m from the total K286.61m offered. The weighted average yields for 364 days remained unchanged at 7.20% while 182 days dropped to 4.43% from 4.44% from last week’s auction. There were nil offers for 63, 91, and 273 days.
• Both the Kina Securities Index and Kina Securities Home Index took a dive to end the week low by 6,046.19 and 13,312.29 points respectively.

International

• U.S. stocks fell after Republican demands left Congress without a deal on a federal spending bill. The benchmark index halted a three-day winning streak, though ended well of session lows with a late rally in a flood of trading volume associated with the quarterly expiration of options and futures on stocks and indexes.’
• The Australian share market is heading into Christmas trading near a 10month high, led by the major iron ore miners, as investors tip the global economic recovery will mean commodities will be in high demand.
• European shares remained at 10-month highs on Thursday, as hopes of more stimulus in the United States and potential COVID-19 vaccine rollouts in Europe strengthened the case for a global economic recovery.
• Asian shares slipped on Friday after Reuters reported that the United States is set to add dozens of Chinese companies, including the country’s top chipmaker SMIC, to a trade blacklist later in the day.

• The Department of National Planning and Monitoring approved K4.0m to Finance the Central Board Post Project which sees boarder markings and stations to detect when the National Capital District Boundaries End and where the Central Boundaries begins. Minister for Finance and caretaker Minister for National Planning and Monitoring Hon. Rainbo Paita presented the cheque to Central Governor Hon. Robert Agarobe for the project.
• The Independent Consumer and Competition Commission (ICCC) announced an upturn in fuel prices for the month, effective 8 December 2020. Retail prices for petrol, diesel and kerosene will increase on average throughout PNG as a result of crude oil price increase during the month of November 2020 attributable to news of the progress of a potential COVID - 19 vaccine which has instilled hopes of a gradual recovery in oil consumption. Consequently, fuel prices in Port Moresby for petrol, diesel and kerosene will rise to K2.83 from K2.81, K2.42 from K2.33 and K2.10 from K2.00 respectively.
• City Pharmacy Ltd Group (CPL) launched its online shop to give customers convenient and safe shopping experience. Managing Director Sir Mahesh Patel said the online shop shop.cpl.com.pg will have all the variety of goods for sale. The interactivity and engagement will be available for all CPL shoppers choosing online shopping with greater access and less shipping costs made possible by our partner bank and local delivery service providers. The online service would cater for all domestic and international shoppers for CPL Group and plans for provincial deliveries around the country by January 2021.
• Credit Corporation PNG (CCP) announced that its Board decided not to pay an interim dividend for the FY20 Financial Year given the economic uncertainty because of COVID -19. In assessing its options, the Board considered CCP’s dividend policy, capital strength, potential impacts on capital because of increased provisioning resulting from COVID -19 -related economic effects and credit stress testing scenarios. CCP Chairman Mr Syd yates said the Board’s decision on the FY20 interim dividend is prudent given its desire to preserve a strong balance sheet and considering the present economic circumstances.
• More than 600 policies have been sold with K1.3m in premiums since the launching of Bank South Pacific Life (BSP Life) PNG’s insurance product in January, said Country Manager Mr Nilson Singh. He said we’ve hopeful with the market and the endowment product Wantok Delite since the start. We knew there was a market with middle -class income earners looking for products that will get them insured and products that will help them save for the future he said. Mr. Singh said BSP Life PNG operations had been impacted by the COVI D -19 in particular our ability to go out and sell. They plan to move to Lae in April 2021 and then Mt Hagen in January 2022.
• The week’s Treasury Bill overall auction was oversubscribed by K67.3m from the total K261.24m offered. The weighted average yields for 182 and 364 days remained unchanged at 7.20% and 4.44% from last week’s auction. There were nil offers for 63, 91, and 273 days.
• Both the Kina Securities Index and Kina Se curities Home Index rose to end the week at 6,04 7 .85 and 13,361.54 points respectively.

• A refinancing agreement of about K1.4bn was signed between the Minister for Treasury Hon. Ian Ling-Stuckey and the Australian Government. According to Hon. Ling Stuckey “the financing agreement provides around K1,380m of financing with interest costs of zero because of the G20 debt relief. After the debt relief period, the financing moves to interest costs linked to a 10-year Australian Government bond yield which is under 1% per annum. The first part of the assistance is an additional AU$140m or K350m to support the 2020 Budget.”
• Furthermore, Hon. Ling-Stuckey said the focus of the current Government was to use the funding to pay off massive debts that the Government currently has. There will be an agreement under the International Monetary Fund monitored programme to set up an arrears verification committee to check and verify outstanding contract payments. These payments will be injected back into local businesses. Hon. Ling-Stuckey also said the second part of the assistance was to rollover the K1.028 bn (US$300m) in the 2019 financing provided through a short-term loan from Export Finance Australia.
• A foundation agreement between the Government and the United States of America (USA) to boost trading is underway. It is aimed at exploring specific two-way trade opportunities whether in the agriculture sector, creative industry sector or other areas. According to USA ambassador to PNG Ms Erin Mckee the focus would be bilateral trade opportunities in agriculture and other sectors and that there needs to be an increase in the trade volume between these two countries.
• PNG Power Limited (PPL) was commended by Prime Minister Hon. James Marape to deliver cheap electricity to its consumers. According to Hon. Marape Niu Power Limited and Dirio Gas and Power Company Limited would supply about 103 megawatts (MW) of power using natural gas from the PNG LNG project to the Port Moresby grid. He challenged PPL to be effective and find corresponding partners that can assist to produce cheaper electricity. PPL had more than 103MW of power supplied to Port Moresby. Hon. Marape said “70% of the country can be powered because 70% population from the highlands grid runs from Lae, Madang, Wau-Bulolo into Porgera and Hides and the Government aims to for the Port Moresby grid to connect to Kerema and to Alotau”.
• Moreover, PPL Chairman Mr Peter Nupiri said there are progressing to upgrade and repair infrastructure through the Asian Development Bank (ADB) funding of K60m. The main issue faced by PPL is power transmission and currently there are studies with the grips to understand how to improve efficiency. The main challenges faced was the Port Moresby grid which PPL plans to get accomplished with the K60m funding.
• Nambawan Super Limited (NSL) have announced the recent appointments of to its executive management team namely Mr Pochon Lili as Chief Financial Officer and Ms Beverlyn Malken as General Manager Corporate Governance. Upon welcoming the two (new) appointees, NSL Chief Executive Officer Mr Paul Sayer, stated that the Fund remains dedicated to developing the capacity of its team and investing in future leaders from within NSL.
• Paradise Foods Limited (PFL) and United Nations Food and Agriculture Organization (UN FAO) signed a Memorandum of Understanding (MoU) to buy cocoa in the East and West Sepik Provinces. According to Chief Executive Officer Mr James Rice, UN FAO would support about 10,000 farmers which these farmers will cultivate the cocoa seedlings and later supply to PFL. Mr Rice said, “a new K55m chocolate factory would be built in Lae next year thus the supply to cater for the growth. The UN FAO will work to educate farmers and improve quality. We are not investing, we are agreeing to buy the farmer outputs, but the UN FAO is investing K340m in the programme. PFL had two big projects which one is to double its business in the next five years and the other is to localize everything it bought.
• The week’s Treasury Bill overall auction was undersubscribed by K112.7m from the total K269.2m offered. The weighted average yields for 364 days remained unchanged at 7.20% from last week’s auction. There were nil offers for 63, 91, 182 and 273 days.
• The week’s Central Bank Bill overall auction was oversubscribed by K30.0m from the total K235.0m offered. The weighted average yields for both 28 and 91 days dropped by 0.04% and 0.34% to 1.33% and 2.07% respectively from the last auction. There were nil offers for 63, 182, 273 and 364 days.
• The Kina Securities Index and the Kina Securities Home Index remained unchanged for the week at 6,026.94 and 13,312.29 points respectively.

Prime Minister James Marape revealed nine Cabinet Ministers who will be taking on extra portfolios following the decommissioning of their former colleagues who moved to the Opposition. These include: Mr Pila Niningi as Minister for Inter-Gov’t Relations and Justice and Attorney, Dr Lino Tom as Minister for Fisheries and Marine Resources and Immigration and Border Security, Mr John Simon as Minister for Agriculture and Livestock and Health and HIV/AIDS, Mr John Rosso as Minister for Lands and Physical Planning and Education, Mr William Onglo as Minister for Energy and Higher Education, Mr Kerenga Kua as Minister for Petroleum and Labour and Industrial Relations, Mr Saki Soloma as Minister for Defence and Correctional Services, Mr Jelta Wong as Minister for Civil Aviation and State Enterprises and Mr Rainbo Paita as Minister for Finance and National Planning and Monitoring.

• According to PNG ambassador to China Don Sawong, PNG’s estimated value of exports to China grew from US$34.56 b in 2018 to US$38.52 b last year. China aims to develop the understanding and approach of more Chinese investors on the investment environment and the ease of doing business in the Pacific.
• According to the Kumul Consolidated Holdings Ltd (KCHL) Managing Director (MD) Isikeli Taureka, reforms for State Owned Enterprises (SOE) are on track and will endure whether there is a change in government. The reforms were designed to separate politics from commercial decisions. MD said the amendment to the KCHL Act was approved by the National Executive Council aiming to achieve proper governance and more independence, he said.
• PNG Ports Corporation paid their 2019 dividend of K9.6 million to KCHL. PNG Ports Chairman Kepas Wali said it was 50%of the total dividend for 2019 which estimates to be around K19.8 m. Mr Wali said the company continued its operations during the Covid-19 pandemic even though its cargo and shipping volumes had decreased.

• The Small to Medium Enterprise Corporation (SMEC) and the People’s Micro Bank (PMB) have signed a contract to provide loans to those with limited or no access to capital. PMB Chief Executive Officer (CEO) Anthony Dela Cruz said the bank was pleased to become an institutional partner of the SME Corporation in implementing the financial inclusion credit facility that aims to assist entrepreneurs. 

• Following its Board meeting last month, Nambawan Super Limited (NSL) CEO, Paul Sayer announced the Fund’s plan to move its head office from Downtown, Port Moresby to Waigani so that member services and support roles are in one central location. The new complex will have four levels of offices with a separate warehouse (archive facility) and car park. According to Mr Sayer the building will become a one-stop-shop NSL headquarters, providing services such as benefit lodgements and member ID cards and new custom training facilities to accommodate the growing member financial literacy training programme. Initial planning, NSL has indicated that more than K100m would be invested in the development. 

• The country’s newest power project, Dirio Gas and Power Ltd, planned to supply Port Moresby with 45 megawatts of power using natural gas from the PNG LNG project was commissioned on 19th Thursday, November 2020. Mineral Resources Development Company MD and CEO Augustine Mano said the commissioning of the project signalled the entry into power generation business for the first time by a nationally-owned company. Dirio is owned by PNG LNG project landowners in Hela, Southern Highlands, Gulf, Western and Central. Their provincial governments are also partners in this project. 

• This week’s Treasury Bill overall auction was undersubscribed by K108.05m from the total K347.16m offered. The weighted average yields for 182 drop by 0.04% to 4.44% whereas 364 days remained unchanged at 7.20% from last week’s auction. There were nil offers for 63, 91 and 273 days. 

• The Kina Securities Index was up by 4.3% to finish at 6,026.94 from 5,780.14 while the Kina Securities Home Index was down by 0.04% to 13,312.29 from 13,317.17 points respectively