Kina to capitulate or even drop further in the coming months, O'Neill throwing PNG under the bus while enriching himself.
PNGBLOGS Staff Writers
Now we have another reason behind Don Polye's sacking.
The 2013 Final Budget Outcome has just been released.
It highlights the economically devastating effects of Prime Minister Peter O'Neill's constant (and often illegal) meddling in the nation's finances and his disregard for due process.
No responsible Treasurer could have stayed in the job judging by the figures contained in the Outcome. They have Peter O'Neill's fingerprints all over them, and he is the one who should take the blame.
He is ultimately responsible for what has happened in 2013, and he must be held accountable for the looming economic and fiscal disaster.
The economy is already showing signs of stress, and the Outlook merely confirms what we all know.
The price of basic foods such as bully, tinfish, rice, bread, milk and so on is skyrocketing as the value of the Kina collapses because of Mr O'Neill's mismanagement of the national economy and his gross irresponsibility and disregard for the laws of the nation.
The huge fall in the kina began shortly after he stole the Ok Tedi mine from PNGSDP - the market was factoring in its fears about the ability of the now State-owned mine to be able to generate a profit.
How right the market was. PNGSDP's public comments show that Ok Tedi had confirmed annual dividends of approximately $US350 million to the company and to the State for the next few years.
Those dividends in effect represented Ok Tedi's net profits. A few months ago Ok Tedi announced that its profit had fallen from about $US350 million in 2012 to just under $US20 million in 2013.
The Prime Minister has provided no credible reason for the fall, blaming various factors ranging from bad weather to the copper price.
Even put together, the factors he has blamed cannot account for such a huge loss. The public has a right to know where all this money - more than K1 billion - has disappeared to.
The effects of the Prime Minister's disastrous and illegal expropriation of Ok Tedi can be seen in the Outcome.
These official figure show that Government finances got hammered by shortfalls in mining and petroleum taxes (K540 below Budget) and dividends (K132 million below budget at ZERO).
In 2012 Ok Tedi contributed about 15 percent of Government revenue. Last year it contributed nothing!
This is an important reason to keep the State out of private business;. Ok Tedi is now in the same mess as all the other SOE's, and the people are paying for it through lower services and higher costs.
The worst spot of the figures in the Outcome is that ORDINARY PAPUA NEW GUINEANS ARE PAYING FOR THE INCOMPETENCE AND IRRESPONSIBILITY OF THE PRIME MINISTER.
Personal income taxes were higher than budgeted for by K200 million.
The Outcome also show that at the end of 2013 the fiscal deficit was K3 billion, almost K500 million above budget.
So all the shady deals that the Prime Minister has personally ordered and arranged all by himself - including but not limited to the USB loan and the Chinese ExIm Bank loan - are also eating the heart out of the nation's finances.
There is no improvement in sight for long-suffering Papua New Guineans.
The long-awaited boost from the PNG project is not going to happen for at least several years.
The reason is that the shady UBS loan appears to have tied up the LNG dividend stream, which was supposed to have gone into the Sovereign Wealth Fund for the benefit of the people.
Now all the benefits will flow to UBS and the people - only the Prime Minister knows who they are - who have managed to be paid fees or get a cut from the deal until at least 2018.
Indeed, the UBS loan may never be repaid - the Ombudsman Commission's directives appear to give weight to the theory that loan repayments may not be made until the OC has completed its inquiry.
There is also some disquiet amongst certain Australian authorities about the legality of some aspects of the loan, just as there is in Papua New Guinea.
All the patterns that were evident before and during the economic and financial crisis caused by former Prime Minister late Bill Skate (a close friend, political mentor and confidant of Mr O'Neill) are evident now.
The most glaringly obvious is the fall in the value of the kina - 25 percent of its value against the US dollar over the last 12 months.
Efforts by the Central Bank to prop the currency up have not worked in terms of any increase in value. It has burnt about $US1.2 billion in forex reserves trying to do so, and more hard-earned US dollars are on the way down the drain.
Total import cover has fallen from about 10 month to about five months.
It is going to be a rough ride for Papua New Guinea over the next 12 months, and more suffering is on the way for every man woman and child in the village.
All the doubts about the ability and the integrity of the Prime Minister are proving true.
The 2013 Final Budget Outcome has just been released.
It highlights the economically devastating effects of Prime Minister Peter O'Neill's constant (and often illegal) meddling in the nation's finances and his disregard for due process.
No responsible Treasurer could have stayed in the job judging by the figures contained in the Outcome. They have Peter O'Neill's fingerprints all over them, and he is the one who should take the blame.
He is ultimately responsible for what has happened in 2013, and he must be held accountable for the looming economic and fiscal disaster.
The economy is already showing signs of stress, and the Outlook merely confirms what we all know.
The price of basic foods such as bully, tinfish, rice, bread, milk and so on is skyrocketing as the value of the Kina collapses because of Mr O'Neill's mismanagement of the national economy and his gross irresponsibility and disregard for the laws of the nation.
The huge fall in the kina began shortly after he stole the Ok Tedi mine from PNGSDP - the market was factoring in its fears about the ability of the now State-owned mine to be able to generate a profit.
How right the market was. PNGSDP's public comments show that Ok Tedi had confirmed annual dividends of approximately $US350 million to the company and to the State for the next few years.
Those dividends in effect represented Ok Tedi's net profits. A few months ago Ok Tedi announced that its profit had fallen from about $US350 million in 2012 to just under $US20 million in 2013.
The Prime Minister has provided no credible reason for the fall, blaming various factors ranging from bad weather to the copper price.
Even put together, the factors he has blamed cannot account for such a huge loss. The public has a right to know where all this money - more than K1 billion - has disappeared to.
The effects of the Prime Minister's disastrous and illegal expropriation of Ok Tedi can be seen in the Outcome.
These official figure show that Government finances got hammered by shortfalls in mining and petroleum taxes (K540 below Budget) and dividends (K132 million below budget at ZERO).
In 2012 Ok Tedi contributed about 15 percent of Government revenue. Last year it contributed nothing!
This is an important reason to keep the State out of private business;. Ok Tedi is now in the same mess as all the other SOE's, and the people are paying for it through lower services and higher costs.
The worst spot of the figures in the Outcome is that ORDINARY PAPUA NEW GUINEANS ARE PAYING FOR THE INCOMPETENCE AND IRRESPONSIBILITY OF THE PRIME MINISTER.
Personal income taxes were higher than budgeted for by K200 million.
The Outcome also show that at the end of 2013 the fiscal deficit was K3 billion, almost K500 million above budget.
So all the shady deals that the Prime Minister has personally ordered and arranged all by himself - including but not limited to the USB loan and the Chinese ExIm Bank loan - are also eating the heart out of the nation's finances.
There is no improvement in sight for long-suffering Papua New Guineans.
The long-awaited boost from the PNG project is not going to happen for at least several years.
The reason is that the shady UBS loan appears to have tied up the LNG dividend stream, which was supposed to have gone into the Sovereign Wealth Fund for the benefit of the people.
Now all the benefits will flow to UBS and the people - only the Prime Minister knows who they are - who have managed to be paid fees or get a cut from the deal until at least 2018.
Indeed, the UBS loan may never be repaid - the Ombudsman Commission's directives appear to give weight to the theory that loan repayments may not be made until the OC has completed its inquiry.
There is also some disquiet amongst certain Australian authorities about the legality of some aspects of the loan, just as there is in Papua New Guinea.
All the patterns that were evident before and during the economic and financial crisis caused by former Prime Minister late Bill Skate (a close friend, political mentor and confidant of Mr O'Neill) are evident now.
The most glaringly obvious is the fall in the value of the kina - 25 percent of its value against the US dollar over the last 12 months.
Efforts by the Central Bank to prop the currency up have not worked in terms of any increase in value. It has burnt about $US1.2 billion in forex reserves trying to do so, and more hard-earned US dollars are on the way down the drain.
Total import cover has fallen from about 10 month to about five months.
It is going to be a rough ride for Papua New Guinea over the next 12 months, and more suffering is on the way for every man woman and child in the village.
All the doubts about the ability and the integrity of the Prime Minister are proving true.
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