PNG JOINS ASIAN INFRASTRUCTURE INVESTMENT BANK.
“PNG’s flag was raised at the Asian Infrastructure Investment Bank in Beijing on 13 May 2024 in a historic ceremony marking PNG’s membership.
The flag raising was with AIIB President Jin and senior members of his team, following on from Prime Minister Marapes visit on 17 October 2023.
PNG joins 109 other members covering 81% of the world’s population and 65% of the global economy. AIIB supports both government and private sector “infrastructure for tomorrow” – i4t – projects.
Our membership of the AIIB opens the doors to more investment in good, sustainable projects which can lead to more growth and jobs” stated the Minister Assisting the Prime Minister on Treasury Matters, Ian Ling-Stuckey.
“The AIIB’s operational focus is on green infrastructure, connectivity and regional cooperation, technology enabling infrastructure, and private capital mobilization.
The AIIB green focus works well for PNG because we have been gifted with great green wealth - PNG has one of the largest forest areas in the world, and 6% of the world’s biodiversity.
“PNG will explore all the AIIB’s financing mechanisms, not just concessional sovereign loans. This will include options such as private sector lending, partial private sector loan guarantees and equity injections.
A particular interest in private financing options is to support our moves towards becoming the food producer for Asia, and becoming a centre of down-stream processing of our agricultural, fisheries and forestry wealth.
“Members of the AIIB will add to PNG’s range of multilateral support partners, including the ADB, World Bank, IMF, and United Nations agencies.
One particularly interesting element of AIIB support is that financing can be provided in Chinese, European or US currencies. Most other multilateral partners are limited to just one currency. This provides opportunities for PNG’s strategy of seeking good, cheap international financing, balanced with domestic financing.
“Currently, lending in US dollars is at an interest rate of over 6%, a rate not considered concessional under our own domestic laws. However, borrowing with the Chinese Remnimbi is currently only about 2.5%.
This clearly has advantages in lower cost borrowings, diversifying sources of funds, and strengthening our linkages with the Remnimbi which can assist other trade partnerships.
All part of the Marape-Rosso Government’s economic reform program of lowering interest costs, a program that is already delivering over a billion Kina in savings to the budget each year” stated the Minister.
Hon. Ian Ling-Stuckey, CMG.MP.
Minister Assisting the Prime Minister on Treasury Matters.
13 May 2024
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