PNG Government to lower home rentals

PAPUA New Guinea’s Treasury Department is considering a recommendation to regulate housing prices in the country.
Treasurer Don Polye says he has asked his department to examine a recommendation by PNG’s Independent Consumer and Competition Commission to regulate the nation’s housing market.
“I have asked the department to look at it,” Polye said in response to a question at a recent press conference.
“I believe in competition. The economy must grow on competition. Where it is really necessary, we have to introduce regulation.
“I would like to see a market that is less regulated and free, competitive, quality-oriented and more thriving.”
Polye, who is acting prime minister while Peter O’Neill is on a state visit to Indonesia, said his focus was to reduce high prices and inflation.
PNG’s annual rate of inflation slowed to 2.2% in 2012; however, some analysts believe it will pick up to an average of 6.3% between 2013 and 2017.
“We have to create a capacity that means the GDP (gross domestic product) must grow,” Polye said.
“Sometimes the country’s economy can grow at double digits without development. We have to balance this out carefully.
“It is better to less regulate the market. Allow the market to control the prices because of capacity and competitiveness.”
PNG is undergoing a massive investment boom as a result of resource projects such as the A$19 billion PNG LNG project.
The ExxonMobil-led project has been blamed for the rise in rental accommodation costs, which have soared in the past three years.
Rental prices in the capital city of Port Moresby range from K500 a week for low covenant housing to K5,000 a week for high class accommodation. Luxury apartments in the more affluent areas of the city can fetch up to K10,000 or more a week.
The country’s GDP is predicted to grow at a moderate 2.8% this year, before surging as high as 15% by 2015. – AAP

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