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PNG AND MONGOLIA: INTERESTING COMPANY

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by PAUL FLANAGAN PNG and Mongolia have much in common economically. Indeed, the latest World Bank Global Economic Prospects report portrays them as near economic twins despite their  historic, cultural and geo-political differences.   If anything, Mongolia was considered the healthier of the two countries. There is now one important economic difference – Mongolia last week  recognised  that it needed help from the international community. By doing so, it mobilised $US440 million in IMF funding and an estimated additional $US5.5 billion in additional cheap loan and grant assistance (much cheaper than Credit Suisse). In contrast, the O’Neill government has failed to concede its economic mismanagement requires a similar solution – low cost financing conditional on improved economic policies.  Foreign currency restrictions are the new norm for business, but this is hurting growth and discouraging further foreign investment. There is much good that a similar assistance package co