Dec 15, 2017 Last Updated 3:10 AM, Dec 12, 2017

PNG power shortage

The Papua New Guinea Government is embarking on a major electricity project, to ease the continuous power problem affecting the National Capital District and surrounding areas. The Independent Public Business Corporation (IPBC) and PNG Power Limited (PPL), signed a contract for the project, worth over K25 million (US$9.6 million), with an Israeli company, LRGroup. This company will upgrade all major power transmission networks in the city. IPBC Managing Director Wasantha Kumarasiri, PPL Chief Executive Officer John Tangit and representatives of LR-Group signed the contract agreement in Port Moresby. The Port Moresby Power Transmission upgrade project came about as a result of a thorough consultation and survey carried out by the IPBC into the power issues affecting the city. Once upgraded it’s believed all power distributions will be done automatically, replacing the current manual distribution system. Kumarasiri, says the city is growing and it needs improved power supply. IPBC will meet all the cost. Meanwhile, the project will commence soon and it’s expected to be completed within a two-year period.

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New business reforms

Vanuatu’s new Companies (Insolvency and Receivership) Act and Insolvency (Cross Border) Act, in combination with the 2012 Companies Act, will make it easier for local people to conduct business. The Asian Development Bank (ADB) supported the drafting of the legislation through the Pacific Private Sector Development Initiative (PSDI). “These ADB-assisted business law reforms will help lower the costs of establishing, running and winding up businesses in Vanuatu,” said George Andrews, Commissioner of the Vanuatu Financial Services Commission.

“ADB is supporting the implementation of the Acts to ensure the benefits are enjoyed by all involved in business in Vanuatu,” said Andrea Iffland, Regional Director of ADB’s Pacific Country Liaison office. “These new laws present a range of choices for entrepreneurs, including single shareholder/director companies, and an innovative community company structure. Electronic business registry development is also part of implementation.” ADB and the Vanuatu Financial Services Commission have begun consultations to assist the government in implementing the new laws.

Awareness-raising is an integral part of implementation, during which members of the private sector, potential entrepreneurs and others will be informed of the benefits of the new laws. The company law reforms in Vanuatu are part of a larger regional effort by ADB to introduce modern company laws that are more suitable for small islands economies. Through PSDI, ADB is also supporting company law reform initiatives in Solomon Islands, Tonga, Samoa Cook Islands, Palau and Kiribati PSDI is a regional technical assistance facility co-financed by AusAID, the New Zealand Aid Programme and ADB.

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Australia’s two major airlines flying thousands of tourists to the region—Virgin and Qantas—lost millions in revenue this year as they grapple with the global slowdown in aviation and rising fuel costs. Multi-million mergers and alliances with megarich airlines from the Middle East fail to ease the pain of the airline giants—engaged in fierce price war in the region, encompassing Australia, New Zealand and the South Pacific.

As reported by this magazine last month, the performance of the two regional airline leaders comes against a backdrop of IATA (International Air Transport Association) estimating that the airlines lost US$22 billion in the last financial year. Qantas lifted its bottom line back into the black to the year in June, 2013 posting a modest A$6 million full year net profit after recording its first loss since it was privatised. With its low budget carrier Jetstar spreading its wings in the South Pacific and Asia, Qantas has kept its image brand name but has suffered heavily due to dwindling travel demands across the region.

The poor profit comes in a year in which Qantas launched its alliance with Emirates as part of an attempt to turn around the performance of its under-performing international operations. Its chief executive Alan Joyce cautioned that the world travel market was still slow but there were signs of recovery in 2014. “The operating environment remains complex and volatile, but we are now beginning to realise the benefits of the tough decisions that we have made over the past 18 months,” announced Joyce. Joyce remained pessimistic however about Qantas maintaining its upward spiral in profits after a historic loss of A$144 million last year—the first since being privatised in 1995.

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Tonga’s tourism and transport industry not only got its first taste of what a cruise luxury liner can bring to its shores but more importantly how to reap the benefits from the thousands of tourists disembarking on the kingdom. When cruise boat Sea Princess, bringing with it 1950 passengers from Australia, berthed at the newly upgraded Vuna Wharf in Tonga’s capital Nuku’alofa last month, the industry was focused on ensuring the visit was memorable for the visitors and worthwhile for the hosts.

Thanks to a South Pacific Tourism Organisation organised Pacific Port Preparedness Workshop, held in August, the Tongans have mobilised themselves into a Tonga Cruise Steering Committee, made up of stakeholders from the Tonga Ports Authority, hotel operators, cultural centres and domestic tour operators. Stakeholders like Tonga Ports Authority’s Mosese Lavemai said the workshop was a success as it equipped stakeholders with facts and trends learnt from fellow SPTO member nations (14 nations).

“In the workshop, we were able to identify the weaknesses that we may not have noticed in the past and how to benefit from the short visits,” he said. “We formed our Tonga Cruise Steering committee where stakeholders who attended the workshop were able to gather information from the workshop to ensure our people gained maximum benefits from the visit. “We have a strategy aimed at enhancing the onshore visitor experience using our coordinated approach.”

He said on September 7, they invited one of the workshop coordinators, John Nell back to Tonga to conduct an observation survey and report back to the committee. “We will be meeting soon to discuss the findings and how best to address the next cruise liner visit,”Lavemai said. “But the information from that workshop definitely pointed us in the right direction and from here it is full steam ahead.”

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Business Intelligence

FNPF no interest in PNG: Fiji’s pension fund, the Fiji National Provident Fund (FNPF), has no immediate plans in Papua New Guinea, after it withdrew from a telecommunications deal involving PNG-based bemobile. Chairman Ajith Kodagoda, says as of now it has no emerging interests in Papua New Guinea, despite earlier indications the superannuation fund was in talks with the Independent Public Business Corporation.

Air NZ confirms job cut proposal: Air New Zealand has confirmed it plans to cut 180 jobs in Auckland but denies union claims it’s closing a large maintenance facility. The airline has confirmed it has entered into consultations with staff at the Auckland Technical Operations engineering base about plans to cut 180 jobs. It says the changes reflect an expected fall in future demand for wide-body maintenance services from within Air New Zealand and from external customers.

100% cigarette-tax hike in CNMI: CNMI House Floor Leader Ralph S. Demapan has pre-filed a bill that will impose higher taxes on every pack of cigarettes to fund the group health/ life insurance of government employees. The government needs US$8 million to fund the group’s health/life insurance that will be administered by the Department of Finance due to the looming demise of its retirement fund.

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