By
MALUM NALU
Papua New Guinea’s budget revenue forecast in 2012
and the medium term is expected to be affected by global demand for primary
commodities, according to Bank of PNG’s quarterly economic bulletin.
Governor LoiBakani said
global demand for primary commodities was expected to decline in 2012 and in
the medium term, in response to a weak global demand and improvement in supply
conditions.
“However, oil price is expected to remain elevated
as a result of supply constraints associated with the geopolitical tensions in
the Middle East and North Africa,” he said.
“This is likely to affect PNG’s budget revenue
forecast in 2012 and the medium term.
“As of March 23, 2012, the prices of gold fell to
US$1,654.10 per ounce after a high of US$1,718.28 at the beginning of the
month, while the price of oil continues to remain volatile and traded at US$105
per barrel.
“The International Monetary Fund (IMF) projects
inflation in the advanced economies and some of the emerging economies to ease
further towards the end of 2012 as a result of the low global demand and
expectations for low inflation.
“According to the FAO Food Price Index (FFPI),
international food prices have started to pick up again to an average point of
215.3 in February 2012, after dropping to its lowest level of 210.8 points in
December 2011.”
Bakani said inflationary pressures in the domestic
economy would come mainly from domestic demand pressures associated with high
inflows and spin-off activities relating to the construction of the LNG project
and increased government spending.
“The upside risks to domestic inflation will stem
from: the volatility in import prices; a fall in prices of export commodities;
depreciation of the kina exchange rate; and higher than budgeted government
expenditure,” he said.
“The government must be disciplined in its spending,
particularly during the national election period, to keep within the 2012
budget.”
No comments:
Post a Comment