Page 28 - IB July 2018

Economy

Fiji advised to ride on PNG’s impending boom

By Dionisia Tabureguci

A second round of investment boom
imminent in Papua New Guinea could
provide Fiji with the chance to achieve the
optimum five per cent economic growth
it is capable of, a regional economist has
forecast. And he advises Fiji to get itself
ready to be able to benefit from it.
“Fiji cannot just sit back and say, look,
a three or three and half per cent growth is
good enough for us. PNG is a lot closer to The Exxonmobil gas field in PNG. Photo: CSE Transtel
us than the other markets that businesses
here are targeting and I think there’s a the potentials that will be there when “Those projects are coming. They’re not
lot of potentials there,” said ANZ Bank’s Papua New Guinea kicks off those four a dream, they’re not fiction, they’re a real-
Sydney-based senior economist Dr Kishti projects at once,” Sen added. ity,” said Sen. “They’re well advanced with
Sen in an interview with Islands Business In April, ANZ released its first Pacific the Final Investment Decision so when it’s
magazine. Outlook for 2018, where it focused on made, then there is a leg of around 6 to 8
“It’s going to go through a massive PNG. The highlight for its long term pros- months before they put the shovel on the
boom in investment and what our Prime pects was the expected kick off of major ground to get it going, so there’s still 18
Minister should do is pick up the tele- gas projects in two years’ time at the latest. months to two years for people to be quali-
phone, call his PNG counterpart and ask “Both ExxonMobil PNG (with a planned fied, upskilled and be ready to provide.”
him how we can help. Because they will US$6b expansion at their PNG LNG Plant) If Fiji is successful in pushing its work-
need help. They don’t have the capacity to and Total PNG (the main proponents of a ers over to PNG to fill the gap there, it will
accommodate all those massive projects green-field Papua LNG project costed at create space locally for the unemployed to
at once. They will need a lot of labourers around US$13b) are well advanced in their move into the workforce and this in turn
– welders, carpenters, lorry drivers, etc.” FEED (front end engineering design) deci- will boost Fiji’s labour force and lift a good
The interview was preceded by the re- sions. We expect both petroleum majors number of Fijians out of poverty.
lease of ANZ’s Pacific Economic Outlook to make announcements on the timing of “At present, a significantly large pro-
for Fiji, the second in its series of Pacific a Final Investment Decision (FID) during portion of the population live below the
Economic Outlook, where it provides its 2018. We expect FID in 2019. Once under national poverty line,” the Fiji Economic
views on key economies in the Pacific re- construction, real GDP growth of PNG will Monitor said. “According to the World
gion based on publicly published historical shift to a higher plane and is likely to stay Bank, 34 per cent (nearly 300,000) of
data. Co-authored by Sen, the Fiji Outlook there for most of the next decade,” Sen Fiji’s citizens were below the poverty
noted that while Fiji has had a good run wrote on PNG’s economy. line in 2013. While the poverty ratio has
this decade, and growth is projected at As well, increased investments are declined from nearly 40 per cent in 2002,
a little above three per cent in 2018 and expected from existing large copper, gold, to hover around 30 per cent of the popu-
2019, it should and can be growing at a silver and nickel mines including Lihir, lation considered poor and vulnerable to
rate of five per cent a year driven by labour Pogera, OK Tedi and Ramu Nico, encour- income shocks is too high. In addition,
force growth and productivity growth. aged by favourable commodity price 1.5 per cent of the population lived below
“What we’re saying is we have the development internationally. the international (extreme) poverty line in
technical college ready here and we have These major investments are expected 2013, on an income of F$2.50 (US$1.19)
young people who are saying they can’t to help the bustling minerals powerhouse per person per day. This means that in
find jobs. Go get them and train them. pick up from the waning boon of Exxon- 2013, nearly 13,000 Fijian citizens were
We’re very happy to export our rugby Mobil’s US$19 billion LNG project which unable to meet their minimum nutritional,
talents but we don’t always have to export had helped boost its growth at an average clothing and shelter needs.”
rugby talents. We have to think about our 10 per cent a year from 2011 to 2017. A concerted effort by policy makers
knowledge, which its asset is its ability For Fiji, the logic is simple. When these to grow Fiji’s economy by finding ambi-
to speak English, hardworking and very projects hit the ground in PNG, they will tious ways to exploit its young English-
educated people. So, if we can look at some create a burgeoning demand for skilled speaking population and tap into the
service industries…ICT, think of options, workers, which those who know the coun- economic participation of women should
think outside the box. Don’t just sit back try say PNG itself cannot supply. So where go a long way in building a way out
and say three per cent or three and a half better to draw from than Fiji, which is well for Fiji’s poor.
per cent is enough. It’s not. And tap into equipped with an educated workforce. r dtabureguci@gmail.com

28 Islands Business, July 2018