Housing prices to be regulated

PAPUA New Guinea's treasury department is considering a recommendation to regulate house prices in the country.

Treasurer Don Polye says he has asked his department to examine a recommendation by PNG's Independent Consumer and Competition Commission to regulate the nation's housing market.

"I have asked the department to look at it," Mr Polye said in response to a question at a recent press conference.

"I believe in competition. The economy must grow on competition. Where it is really necessary, we have to introduce regulation.

"I would like to see a market that is less regulated and free, competitive, quality-oriented and more thriving."
Mr Polye, who is acting prime minister of the Pacific Island nation while Peter O'Neill is on a state visit to Indonesia, said his focus is to reduce high prices and inflation.

PNG's annual rate of inflation slowed to 2.2 per cent in 2012; however, some analysts believe it will pick up to an average of 6.3 per cent between 2013 and 2017.

"We have to create a capacity that means the (gross domestic product) must grow," Mr Polye said.
"Sometimes the country's economy can grow at double digits without development. We have to balance this out carefully.

"It is better to less regulate the market. Allow the market to control the prices because of capacity and competitiveness."

PNG is undergoing a massive investment boom thanks to resource projects such as the $19 billion Exxon-Mobil-led liquefied natural gas project.

The developing nation's GDP is predicted to grow at a moderate 2.8 per cent in 2013, before surging as high as 15 per cent by 2015.

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