Lae project needs funds

By HAIVETA KIVIA

INVESTMENT and Public Business Corporation (IPBC) needs an additional K210 million have the Lae Tidal Basin project completed. China Harbour Engineering Corporation is now working on this very important project for the country. The K210 million includes K130 million counterpart funding by the National Government and an additional K80 million needed to offset the cost of the appreciation of the exchange rate of the kina against the United States of America dollar.
Such a demand on additional funding comes at an awkward time when the country is faced with a budget deficit of K500 million and the O’Neil-Dion Government is try to find money to plug the deficit. However, sources say the government is confident it will honour its commitments under the multi-million kina contract.
IPBC’s Tidal Basin project manager Ila Mari told National Planning and Monitoring Minister Charles Abel, National Planning and Monitoring Secretary Dr Peter Kora and the department’s First Assistant Secretary- Economic Infrastructure, Hakava Harry, that IPBC needs the additional funds to ensure that the project is completed on time.
MR MARI told Mr Abel and his delegation that the PNG government obtained a loan as counterpart funding from the Asian Development Bank.
The infrastructure development project is one that Minister Abel and his delegation are well aware of and how funds were brought in to start the project, the Minister said.
He said the NEC submission has already been prepared by IPBC and will soon go before the council for endorsement and approval.
The Minister said the project was stalled for two years since 2010 and the appreciation of the kina on the back of the strong economic growth experienced in the last three years decreased the value of the US dollars that were to be brought into the country for the project.
The Lae Tidal Basin project is expected to cost US$200 million with counterpart funding from the Asian Development Bank and the Government of Papua New Guinea at a ratio of 70:30.
Project manager Mr Mari said five metres of the top soil in the area will be dumped into the sea and the good soil, gravel or stones will be used in the city.
Before visiting the project, the delegation made its first stop at the Lae Port Expansion and Rehabilitation sites.
Minister Abel and his secretary where taken on a tour and briefed on developments taking place.
Mr Abel said that he wanted to see firsthand what was taking shape.