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Sovereign Wealth Fund to stabilise PNG economy
By Online Editor
09:44 am GMT+12, 14/03/2012, Papua New Guinea
The much anticipated Sovereign Wealth Fund (SWF) bill passed by Parliament is a control mechanism to stabilise the revenue and expenditure to make sure there is tangible development in PNG economy.

Director for Institute of National Affairs (INA) Paul Baker said that the government introduced SWF to control money coming in and going out of the country which will be invested or kept offshore and managed onshore.
Baker said that SWF is replacing the trust account which recorded windfalls in 2008.

However, the revenues where poorly managed because of the questionable management that boost the inflation rate.

“The national government budget is expected record an estimated amount of K12 billion in the coming year,” Baker said.

He said that SWF will cater for the fluctuation in the economy and avoid the surge of Kina that might occur in the future as a result of the LNG project.

Baker he said that SWF will provide checks and balances to avoid misappropriation and double dipping which occurred sometime back when the government put the trust funds.

He said that the money in the public trust funds were abused and shifted into private trust account by individuals and parliamentarians because of the system in which the public are not aware of what is going on.

“The growth on gross domestic product (GDP) to an estimated figure of 20 percent will see a little change in the gross national product (GNP) because a lot of money will be repaid to investors from overseas,” Mr Baker said.


SOURCE: POST COURIER/PACNEWS

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