Local Market Summary
• Speaking on FM100’s Talkback show during the week, PM O’Neil indicated a possible increased in the lowest bracket threshold hold from K10, 000 – K20, 000 following the conclusion of the IRC Tax review and their recommendation. This plan will most likely be contingent on the government’s ability to increase its tax revenue base in order to cater for future tax cuts.
• Prime Minsiter Peter O’Neil announced that the national government had begun the process of cancelling special agricultural business loans (SABLs) that were acquired illegally and restart the project with stricter guidelines for landowners. A ministerial committee comprised of Forestry Minister Pruaitch, Lands Minister Allen and Agriculture Minister Tomscoll to note the findings of the SABL’s Inquiry Reports and implement its recommendation.
• Prime Minister Peter O’Neil announced that the government plans to sell its 50% stake in Air Niugini to raise K500 million for two more Boeing 787 Dreamliners. PM also announced plans for possible privatisation of other SOE’s including Telikom and PNG power.
• The National Petroleum Company PNG (NPCP) Managing Director Wapu Sonk stated that the company is ready to do business once the LNG export begins this year. NPCP was formerly known as Kroton #2, was nominated as the state nominee in 2009 to hold 16.6% interest in the PNG LNG project.
• According to the Japan International Cooperation Agency (JICA) annual report released last month, PNG has benefited from about K46 million or 15.3% of the total value of programs funded by JICA. The report stated, PNG is rated third among 13 other pacific counties to receive assistance from JICA.
• Marengo Mining Ltd will finalise its waste disposal approach and feasibility study to trigger financing of its Yandera project in Madang, Chief Executive Les Emery announced this week.
• Oil Palm is now the leading cash crop in the country that is bringing more than K1 billion annually into the PNG coffers through exportation of its oil, according to the Agriculture Minister Tommy Tomscoll.
• Oil Search Ltd Managing director Peter Bo4en announced that the company will more than quadruple its production by next year. He stressed that the company’s solid oil production needed to be increased further because of the PNG LNG project.
• The Barramundis returned home on Saturday fresh from achieving their best ever result finishing fourth in the Super Six stage and also claiming ODI status.
• KSI was flat for the week at 3,872 while KSI Home Index decreased slightly by 0.1% to 8,205 for the week.
International Market Summary
• US trade deficit widened by 12% to $38.7 billion in December. The deterioration was driven by a 1.8% drop in exports – the biggest decline in over a year. Imports lifted by 0.3%. Jobless claims fell by 20,000 to 331,000 last week. US productivity rose at a 3.2% pace in the December quarter after an even brisker 3.6% pace in the September quarter.
• Janet Yellen was sworn in this week as the chairman of the Federal Reserve’s Board of Governors in Washington, while her predecessor, Ben S. Bernanke, joined the Brookings Institution as a distinguished fellow in residence.
• Australia’s economic growth is expected to pick up pace this year thanks to a lower exchange rate and stronger activity in the housing and retail sectors, according to the latest forecasts from the Reserve Bank of Australia.
• BHP Billiton will cut 230 jobs at its Saraji coal mine in Queensland as part of what It described as a “relentless” focus on productivity.
• Woolworths is set to regain its crown as Australia’s fastest growing food and liquor retailer after posting its strongest sales growth since 2011, aided by rising food prices, better relationships with suppliers and clever marketing. (See chart in the PDF attachment below).
• During the week the Kina depreciated against the AUD by 2.5% to 0.4379 and against USD by 0.3% to 0.3917.
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