Trade Winds

□ Png Std Extension

IT IS now possible to telephone direct from PNG to 11 other countries in the South Pa cific. PNG’s Post and Telecommunica tions Corporation has extended its direct dial ISD service to an additional five is land countries: the Cook Islands, Nauru, New Caledonia, Vanuatu and Western Sa moa. Subscribers have previously been able to dial direct to Australia, New Zea land, Tonga, Solomon Islands, Fiji and Kiribati.

□ Tonga Tourist Upgrade

TONGA’S King Taufa’Ahau Tupou has outlined an expansion of Tonga’s Friendly Islands Airways by the end of 1988 with the launch of a new international air serv ice with a Boeing 747. This will require the extension of Tonga’s Fuamotu Airport.

King Tupou also announced the build ing of a new hotel to cope with the ex pected influx of visitors. In addition to the purchase of more smaller aircraft for the airline, the shipping services are to be ex panded with a new 400-seat passenger ferry and a 5500-tonne cargo ship. The ferry goes into service next year, linking Tonga to American Samoa and the cargo ship will service the Fiji, Tuvalu, Kiribati and Tonga route.

□ Miners Lose Exemption

THE TWO largest mining operations in PNG Bougainville Copper Limited and OK Tedi Mining Company lost their exemption from registration under the country’s investment laws. The mines were originally exempted from registering with the National Investment and Develop-

ment Authority because the Government was trying to encourage investment in a new industry in a young nation. Minister for Trade and Industry Sir Julius Chan said the mining industry is now firmly estab lished and would now be given the same treatment as other forms of investment.

Also rejected was an application from Placer Pacific’s Misima mine, in Milne Bay Province, for NIDA exemption. Sir Julius said PNG wanted local businesses to extract the maximum benefit from mining operations.

□ Fiji Inflation Jump

FIJI’S inflation rate is rising steadily again after reaching a record low of 1.8 per cent in 1986. Latest figures put the rate at 5.7 per cent. Inflation peaked at 14.5 per cent.

Higher prices in December for food, al cohol, tobacco, clothing and furniture pushed the consumer price index up one per cent, compared with November.

□ Communications Hike

THE COST of local telephone calls in PNG has been increased by 2 toea to 14t, STD charges by 10 per cent and the stand ard postal rate is now 17t. There is no in crease in the cost of international calls.

Meanwhile, a 2.5 per cent sales tax on all goods and services came into force in Port Moresby on January 1. The tax makes up for cuts in funding from the National Government in the last two budgets.

□ Shrinking Economy

THE Governor of Fiji’s Reserve Bank, Mr Savenaca Siwatibau, said the country’s economy contracted by 11 per cent in 1987 and that it was likely to deteriorate by a further six per cent this year unless there was a marked increase in overseas investment.

On a brighter note, Mr Siwatibau said the nation’s reserves of foreign capital had risen to SUS 141 million at the end of 1987, after falling to less than SUS7O shortly after the first military coup in May last year.

□ French Mining Rights

A FRENCH institute obtained exclusive rights for the exploration and exploitation of mineral bearing rocks in the Polynesian area. The French petition has been ap proved by the International Seabed Au thority. France will now be able to mine for mainly manganese-bearing rock around its Pacific territories in an area in volving about 75,000 square kilometres.

□ Banking Regulations

STRICT new banking regulations in PNG require commercial banks to lend more to

Papua New Guineans and to rural sector activities. Finance Minister Galeva Kwarara told a gathering of bank execu tives in Port Moresby that by the end of 1990 commercial banks will have to in crease from one-half to two-thirds the pro portion of total loans going to Papua New Guineans or Papua New Guinean enterprises.

Another directive requires the banks to allocate one-fifth of their total lending by 1990 to agriculture, forestry or fisheries projects. At present the proportion is 14 per cent and Mr Kwarara calculates that the increase will put an extra $ A 43 million into the “country’s key economic development sectors”.

□ Timber Edict

PNG’s NEW Forests Minister, Mr Tom Horik, said he wanted 1988 to be a year of honesty in the country’s deeply troubled timber industry. A judiciary inquiry into the industry, which still has three months to run, has already revealed corruption, with a number of politicians and other

public figures involved in timber transfer pricing scandals.

Mr Horik says he is prepared to act on the inquiry’s first interim report (the in quiry’s head, Mr Justice Barnett, has rec ommended severe penalties for companies exporting logs illegally from PNG). The Minister wants to see criminal convic tions result from the findings of the in quiry and the deportation of any foreigners found to be abusing PNG’s forestry laws.

□ Unionists On Inspection Tour

A DELEGATION from the International Confederation of Free Trade Unions has sent representatives to Fiji, to test the Government’s respect for human rights and trade union activities. The delega-

Bougainville mining - exemption lost.

PNG timber - a troubled industry.

tion, which met with local labour leaders during a three-day visit, was not a diplo matic mission: a spokesman at the ICFT U’s headquarters in Brussels said the organisation did not want to recognise a Government without establishing that it respected commitments on labour rights.

He said that if pledges had not been kept, there would be follow-up action, but admitted it was too early to say what effect the two military coups last year had on hu man rights and trade union activities in Fiji.

□ Banana Breakthrough

SCIENTISTS in New Zealand have suc cessfully tested a method for improving the quality of bananas exported from the Cook Islands. Packing the bananas in special polyethylene bags that modify the air around the fruit will ensure they arrive in New Zealand, the main importer, in a uni formly green condition.

□ Forex Controls Eased

PNG’s Finance Ministry has relaxed for eign exchange rules imposed last year. This follows a Supreme Court ruling confirm ing the validity of PNG’s Foreign Ex change and Gold Regulation Bill, and its overruling of a National Court declara tion that the regulation was not valid.

Foreign Minister Galeva Kwarara said foreign travel and business allowances had been doubled, while the overseas invest ment ceiling had been lifted by 50 per cent to K 15,000 per year. Importers are to be allowed to negotiate directly with foreign sellers, the moratorium on foreign debts has been reduced from two years to one, and the Central Bank has been advised to adopt a more sympathetic approach to the application of the debt-equity for offshore borrowing.

□ Economic Growth Leap

DEVELOPING countries in the Asia and Pacific region achieved an economic growth rate of six per cent in 1987, com pared to a global slowdown from 3.2 per cent in 1986 to 2.8 per cent last year.

□ Australian Banker Ousted

AN AUSTRALIAN banker left Fiji after having his appointment with the nation’s bank overturned by the then military Government.

Mr Harry Slater was appointed acting chief manager of the National Bank of Fiji after the former manager retired at the end of November.

Twenty-four hours after Mr Slater took up the position, a group of soldiers are re ported to have entered the bank’s head quarters in Suva and delivered a letter to Mr Slater from the then head of Govern ment, Brigadier Rabuka, appointing a branch manager, Visanti Makarava, to the position.

The daily Fiji Times reported that Mr Makarava was with the soldiers when they delivered the letter. A senior army officer confirmed the incident, the newspaper re ported, saying it was necessary to appoint someone who could run and protect the affairs of the bank in the national interest.

Mr Makarava was said to be the pop ular choice among the local staff of the bank. The officer said Mr Makarava’s ap pointment was temporary until a chief manager was appointed.

□ Duty Free Cans For Png

THE PRIME Minister of PNG, Mr Wingti announced that all imports of empty cans and labels by canning factories in the country would be free of duty. Until the announcement, only the James Barnes meat cannery, based in Madang, enjoyed this concession.

Mr Wingti said this was unfair to other local manufacturers of canned meat products.

Canneries which will benefit from the new decision are the Morobe Food Pro cessing Company in Lae and the Hugo Meat Cannery near Port Moresby, owned by the Minister for Civil Aviation, Mr Hugo Berghusar.

□ Lending Rules For Banks

PAPUA NEW GUINEA’S commercial banks have been told they can invest in agriculture bank bonds to achieve the new lending targets for agriculture they have been set under strict new banking regula tions. Finance Minister Galeva Kwarara has advised the banks of new lending rules under which 20 per cent of their total loans must be allocated to agriculture, forestry or fisheries projects by the end of 1990. The present proportion of bank loans devoted to these areas is 14 per cent, and the reg ulations mean a further SA43 million will be directed to these economic sectors over the next three years.

Mr Kwarara says he realises the 20 per cent rule will be challenging for some of the commercial banks; however, the government-owned Agriculture Bank will shortly commence raising funds on the domestic market by issuing agriculture bonds. □

King Tupou bids for tourists.