Category Archives: Roads

PNG Logistics To Benefit From Transport Infrastructure Upgrades

4th December 2017
[This Papua new Guinea economic update was produced by Oxford Business Group.]
 
 
In June the Asian Development Bank (ADB) approved $866.5m in funding for the upgrade and maintenance of the Highlands Highway, one of PNG’s main logistical arteries.
 
The project will see the rehabilitation of large stretches of the 1200-km route, improving connectivity and road safety. As well as ADB financing, funding will come from other development partners and the PNG government, bringing the overall investment to just over $1bn for the 10-year project.
 
The upgrade has national importance, as the highway runs from the main port of Lae through mountainous regions and into the Enga Province, serving around 40% of the population.
 
In addition to roadworks, the investment programme will support the establishment of logistics platforms and services for agricultural production, as well as help modernise other forms of transport infrastructure.
 
 
# Highway work to support logistics and export growth#
 
Improved access to the Highlands region should support the growth and competitiveness of the logistics sector, and back up government plans to boost exports.
 
At present, the imbalance between inbound and outbound cargo has been cited as a key contributor to slow turnaround times and the high costs endured by freight carriers.
 
Many planes and ships bringing goods to the country often leave either empty or carrying exports at volumes lower than their capacity, which affects local logistics costs.
 
According to the World Bank, the average cost of exporting goods from PNG was $1335 in 2014, the most recent year for which figures are available, considerably higher than Singapore ($460), Indonesia ($572) and Australia ($1200).
 
To address this issue, it is hoped that improvements to national transport infrastructure outlined in the long-term development plan Vision 2050 will pave the way for the cheaper transport costs, which could unlock growth opportunities in targeted agri-processing and industrial sectors.
 
“The upgraded Highlands Highway will not only improve connectivity, but also help drive inclusive economic growth,” David Hill, country director of the ADB, told OBG.
 
“Although more infrastructure investment is needed to improve transport links across the country, the recently approved 10-year Sustainable Highlands Highway Investment Programme will connect PNG’s Highlands – a region with a lot of mining activity and vast opportunities for agri-businesses – with the country’s most important port, Lae, which was recently upgraded by ADB financing.”
 
 
# Extraction industries continue to provide short-term logistics opportunities#
 
While government plans to improve infrastructure and diversify the economy are not expected to translate into benefits for the logistics sector immediately, in the near term operators stand to receive a boost from proposed projects in the extraction industries.
 
Such projects are major drivers of logistics sector growth, according to Mark Schell, country manager of international carrier DHL Express, who noted that logistics services experienced high levels of growth during the development stage of recent large-scale liquefied natural gas (LNG) undertakings, only to fall back to pre-construction levels once work was completed.
 
“When these large projects are under development you can expect growth of 10-40%; but once completed, the following year can see a reduction of 10% year-on-year,” he told OBG.
 
In terms of potential developments, French energy giant Total is reportedly looking to further develop reserves in the Elk-Antelope gas field, while ExxonMobil is assessing the feasibility of a proposed third LNG train at the PNG LNG project.
 
In the mining industry, the planned $2.3bn Wafi-Golpu copper and gold mine is expected to come on-line in 2020, and production at the Chinese-backed Frieda River copper-gold project in the Western Province is slated to start in 2024. 
Via: Loop PNG
 
 

Maru Confident Budget Will Sustain Economic Growth

Source: Post – Courier

 

BY GORETHY KENNETH

National Planning Minister Richard Maru is more than convinced that the 2018 Budget will enhance the preconditions for sustainable economic growth in the short to medium term.

Mr Maru said that for the first time in many years, the Government has increased the economic sector funding from 6 percent in 2017 to 15 percent in the 2018.

He said this confirmed to the Alotau Accord 2 to make economic growth the number one priority.

He said the aggregate 2018 Capital Investment Budget is K4,643.92 million. This shows an increase of 15.7 percent compared to the 2017 original budget appropriation. He said the Budget was strategically focused to invest in enhancing the preconditions for economic growth and prosperity, which will build on the remaining few years of O’Neill Government.

“This Government will mobilise necessary resources within the tight fiscal envelope to provide growth conditions to set the pace for future growth and development. The 2018 Capital investment Budget consolidate key interventions that will encourage business activities, generate employment, increase both export and tax revenues, replace import, and broaden and diversify our economic base strengthening renewable sectors and manufacturing.

“The commodity price fluctuations in the global market have had an adverse effect in our economy in the last three years and in my view we as Government have done very little in addressing the declining trend. If the global commodity price remains suppressed over the medium term with no new projects in the mining and petroleum sectors coming on stream over the same period, our country will continue to face fiscal constraints, prolonged current foreign exchange problems, which will affect the Government’s ability to effectively deliver public goods and services to our people.

“The 2018 National Budget provides the appropriate response of this Government to the current domestic and global economic challenges, focusing on the new measures to stimulate the broad-based economic growth while maintaining fiscal and macroeconomic stability.

“To arrest the declining trend in economic growth, some deliberate attempts were made by this Government particularly to ease the current cash-flow problem with the 100 Day Plan and also the proposed Bill on the Public Money Management arrangement. While these revenue raising measures are important, this Government is looking at sustainable growth measures.”

 

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New Infrastructure Projects with China will Change Lives – Direct Investment by China Railway Group in PNG Economy

 

Media Statement via Prime Minister’s Office PNG

Monday, November 20, November 2017

The Government of Papua New Guinea has signed a serious of Memorandums of Understanding (MOU) with the Government of China and the China Railway company that will deliver a number of new infrastructure projects in the Highlands.

 

Witnessing the signing of the MOU today in Port Moresby, the Prime Minister, Hon. Peter O’Neill CMG MP, said the new projects will have direct positive impacts on the lives of people in Eastern and Western Highlands provinces.

 

“These projects will enhance agriculture, roads and water supply in parts of the Highlands will improve lives and help people to be more active in the economy.

 

“China is one of our strongest development partners, and this direct investment is an example of the huge confidence that China and Chinese companies have in Papua New Guinea.

 

“Despite the challenges in the global economy in recent years, the outlook for the Papua New Guinea economy is very positive and we thank our partners for their commitment to our country.

 

“The projects that we initiated today will be delivered in some of the most remote parts of our country where there is a need to improve connectivity and services.

 

“These projects are taking place as part of the ‘One Belt One Road’ initiative that is creating more efficient trade corridors between the Asia-Pacific and Western Asia.

 

“As this initiative grows we are seeing infrastructure improvements across many developing countries.

 

“At the eastern end of the initiative, Papua New Guinea is deriving benefits that will strengthen capacity to trade across borders.”

 

The Prime Minister thanked the President of the China Railway International Group, Mr. Zhang Zongyan, for visiting Papua New Guinea to see for himself where support can be allocated.

 

“I thank the Government of China and the China Railway Company for their ongoing commitment to Papua New Guinea.

 

“The projects we have agreed on today will deliver positive change for people in many towns and villages.

 

“Your support for Papua New Guinea will be remembered long into the future.

 

“I look forward to further discussing these and other initiatives with President Xi Jinping when he arrives in Papua New Guinea for APEC next year.”

 

The three MOU’s signed today are:
– China-PNG Integrated Agriculture Industrial Park;
– The High Priority Economic Roads Project;
– Goroka Town Water Supply Upgrade Project.

 

The signing of MOU’s was witnessed by Prime Minister O’Neill, Works Minister, Michael Nali, and Lands minister, Benny Allen.

 

Photos:PM O’Neill meets with officials from China Railroad Group and Chinese Government before the signing the MOUs.

Government Aims To Strengthen Partnership

 

Source: Post-Courier

BY ZEBEDEE GIAME

Papua New Guinea is working towards integrating the efforts of developmental partners into the planning spectrum, says Minister for National Planning and Monitoring Richard Maru.

 
He said the national government is committed to strengthening existing development partnerships that are in line with the government’s plans and development strategies.
“We are stepping to a more coordinated and strategic partnership with development partners,” Mr Maru said.

 
He said growing the economy is the government’s focus in the medium term, thus all elements of development needed to be steered towards the venture.

 
Mr Maru said as part of planning towards this government focus, maintenance of roads is critical to achieving the economic growth agenda of the government.

 
Works Minister Michael Nali said the major focus of the government is implementing a well structured maintenance program to ensure the current 4000 km of national roads are in good condition and do not deteriorate quickly.

 
He said the maintenance backlog over the years requires K3b to clear out and also build new highways and missing road links.

 
Works is working to upgrade another 1000 km of national roads.

New International Highway Connecting Jayapura Declared

 
 
 
October 31, 2017
Source: Post-Courier BY JEFFREY ELAPA
 
Ministers for Works Michael Nali has declared the coastal highway from Wutung in West Sepik to Madang through Wewak as an international highway connecting Jayapura in Indonesia.
 
Mr Nali and Secretary for Works David Wereh arrived in Wewak yesterday for a road infrastructure inspection visit of East Sepik and West Sepik provinces.
 
His declaration of the international highway was made during a meeting with East Sepik Governor Allan Bird, Inter Government Relations Minister Kevin Isifu and West Sepik Governor Tony Wouwou and East Sepik provincial government assembly members.
 
He said the coastal highway will now be called an international one because the road links West Papua.
 
He said the Government is committed to link the people with the international highway because there are more business to be done next door with neighbors in West Papua.
 
He said besides doing business, West Papuan friends need to learn a lot from PNG as well.
 
Mr Nali said to have two countries contacted by road can strengthen the relationship including business.
 
Mr Nali and Mr Wereh will be joined by Governor Wouwou to visit the Wewak to Aitape road and fly over to Vanimo for the same purpose.
 
They visited the Hagen-Madang highway and then the Madang-Wewak missing link that will be part of the international highway.
 
They also visited the Angoram highway which will have the biggest oil palm mill and biggest ply wood mill in the region and later visit Wewak town roads.

K1.7m road for remote EHP

1st November 2017

Source: Post-Courier

 

The Coffee Industry Corporation’s Productive Partnerships in Agriculture Project (coffee) is set to construct the 5km road.

 

Contract signing for construction of the Nombia-Bibiori road was at the Central Supply and Tenders Board (CSTB) office in Port Moresby on Friday, 20 October, 2017.

 

 

The road will service over 20,000 people of the Lamari LLG in the Tairora area of Obura-Wonenara to transport their coffee to the nearest Kainantu town. The area is known for producing very high quality organic coffee.

 

 

CSTB chairman Dr Ken Ngangan says: “The contract is not of a high amount but we have to ensure the process is followed.”

 

 

Minister for Labour & Industrial Relations and MP for Obura-Wonenara electorate, Mehrra Minne Kipefa, on behalf of his people thanked CSTB for allowing the procurement and tendering process to go through.

 

 

The local MP also acknowledged CIC-PPAP for partnering Obura-Wonenara District Development Authority (DDA) to rehabilitate the road, which he says will open up the area for other services in health and education.

 

 

With productive partnership with DDA and PPAP, over 20km of road will be rehabilitated beginning from Norikori Junction to Bibiori. The first 15km is being funded and/or counter funded together.

 

 

This March/April, the DDA through its District Support Improvement Program (DSIP) fund, financed the construction of a 7km access road from Norikori junction to Barabundora Junction. The other 9km from there to Nombia will be counter funded by the DDA and PPAP as per discussion between Minister Kipefa and Project Manager for CIC-PPAP, Potaisa Hombunaka.

 

 

Meanwhile, Hombunaka congratulated Kassampy Construction Ltd for being awarded the contract and also for making it into the good books of World Bank and International Fund for Agricultural Fund (IFAD) for passing this first test. The real test will be accomplished on delivering a Works standard road.

 

 

 

“We have to ensure the process is followed because the end game is to build a road that is of high quality standard that will last for years,” says Hombunaka.

 

 

 

During construction, both PPAP Consulting Engineers and Provincial Works Engineers will carry out routine inspections till conclusion.

 

 

 

The World Bank and IFAD are financiers of the CIC-PPAP industry rehabilitation effort and construction of access roads comes under Component 3 infrastructure development function. The CIC going forward will be recommended to have an Engineering section in its structure as market access is critical to growth of the industry.

 

 

 

The CIC-PPAP senior procurement officer, Ms Theresa Witi, was overwhelmed in that this will be the first road to be constructed under the project.

 

 

 

“Finally we will build the first road. I would like to thank everyone, including CSTB and project financiers for the process to go through,” says Ms Witi.

 

 

 

Coffee is the lifeline of the local Lamari LLG people. The locals are hard working. They have the capacity to produce more beans from their coffee gardens, but the dilemma for the last 40 plus years is they have no easier access to market.

 

 

 

There are only two closest access roads to Lamari, one ends at Obura Station and the other at Nombia.  The locals prefer walking to Nombia, which is about 25km from Kainantu town and 20km from Aiyura Research Station and SIL Ukarumpa. The economic cost of transporting a coffee bag to Kainantu through Obura station is K50 compared to Nombia, which is only K20.

 

 

The new road link will be a new chapter in the lives of these people, often referred to as the back page of Eastern Highlands Province.

 

 

At the signing ceremony were CSTB chairman Dr Nagangan, project manager of CIC-PPAP Hombunaka, Minister Kipefa and local contractor Kassampy Constructions Ltd representatives.

 

 

The coffee rehabilitation is a CIC project through Department of Agriculture & Livestock. It is financed by a loan facility from World Bank and IFAD with support funding from the PNG Government.

Works Minister: Opening of Missing Road Links, Government’s Priority

Source: EmTV Online

Tucked under rugged ranges between Gulf and Eastern Highlands is Menyamya, one of the least developed districts in the country.

 

 

However, this under developed district is rich with fertile soil renowned for producing one of the country’s best organic coffee.

 

 

“We produce some the best organic coffee in the country, but we don’t have roads to transport them to nearest markets in Lae or Goroka,” a local said.

 

 

Like many isolated rural communities, road access remains a barrier to development and for Menyamya, it has been a barrier for their economic progress and access to basic services.

 

 

In the last 5 years the O’Neill-led Government has prioritised the opening of missing road links.

 

 

On Tuesday, Works Minister, Michael Nali, told the people of Menyamya that the Government will allocate funding from a K3 billion Asian Development Bank loan in order to open missing links in the district.

 

 

“There are many road links in the district, once we open the trans-highway between Gulf and Morobe, Menyamya will be open to the rest of the country as well,” Minister Nali said.

 

 

The K3 billion funding from ADB will be put to reconstruct the entire Highlands Highway, Nadzab to Kagamuga Airport in Mt Hagen.

 

Wereh: Road to be redesigned, reconstructed

 
October 20, 2017
Source: The National
 
By LUKE KAMA
 
WORKS Secretary David Wereh has clarified that the Chimbu section of the Highlands Highway, from Chuave to Munde at the border of Western Highlands, will be redesigned and reconstructed using advanced engineering technologies.
 
During a tour of the highway with Works Minister Michael Nali from Mount Hagen in the Western Highlands to Lae on Monday, Wereh highlighted that the Chimbu section was the worst part of the highway that experienced a lot of problems.
 
“This is the section that experiences a lot of problems of landslips and landslides; there are waterlogged areas that need advanced engineering designs and under the K3billion Asian Development Bank-funded project to rehabilitate the highway, we want to address these issues once and for all.
 
“Chimbu will be a separate section that will consume up to almost one third of the K3billion and we will be controlling water, far away from the roads, right up to the water sources.
 
“It will be a design and construction project to which advanced engineering technology will be applied to construct and once construction is completed, it will solve these issues of water coming onto the road and destroying the tar, creating potholes, the drainage, landslide or landslips will stop.
 
“We will do it properly and appropriately and I am appealing to the people of Chimbu to accept developments and stop unnecessary claims,” Wereh said.
 
He said Chimbu was renowned for claims and that practice must be stopped in order for change and developments to take place.
 
“I can say in the last Highlands Highway rehabilitation project, Chimbu has consumed and burned up a lot of money through claims for compensation.
 
“We need to stop that.” 
-Post-Courier-

National Road Strategy

 

October 15, 2017

08:00AM 

Source: Post-Courier

 

BY JEFFREY ELAPA

 

A long term Department of Works road network maintenance and management strategy developed recently would address road maintenance throughout the country.

 

Through the strategy, all donor agencies involved in road maintenance programs throughout the country would be re-aligning themselves to assist in road maintenance.

 

Work and Implementation Minister Michael Nali when endorsing the national road network strategy 2018-2040 described it as a blueprint document that will set milestone achievement and will go down in the history of this nation.

 

“This document will serve as a guideline to align all donor programs in PNG road transport infrastructure for the next 20 years.

 

“My Department, with the support of the Australian Transport Sector Support Program (TSSP) has developed an evidence-based strategy to make road maintenance and management work in the country.

PM Applauds Abel For Handing Down First Money Plan

 

Source: Post-Courier

 

Prime Minister Peter O’Neill has commended his deputy and Treasurer Charles Abel for successfully handing down the 2017 Supplementary Budget in Parliament yesterday.

 
“I commend the Treasurer as this is his first budget/money plan. There are now some renewed sense of energy in Treasury and of course as a result of that you can see some real drive into outstanding issues like over expenditure by public servants. The Treasurer is definitely getting things back on track.”

 
Mr O’Neill said that development is taking place across the country in the areas of infrastructure, health and education. “This is only the beginning and we will make sure we deliver before this term expires,” he said.

 
“You see, when we came into office in 2012, we built major infrastructure that you see now,” he said.

 
“If we did not build these infrastructure, the recession will be far worse than today.”
Mr O’Neill said the National Alliance-led government was in control for 15 years and they handed out about seven supplementary budgets when they had surplus, but never built any infrastructure.

 
“To date, they still can’t name an infrastructure they built, and they left no money in the Trust Account,” he said. “Treasury is the engine room, the heart that controls the body, and you should be very careful.

 
“It is a fact, that we are all responsible to correct the position when they are course blow outs, to correct it so we set new targets and that is 2.5 per cent of GDP,” Mr O’Neill said.

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