Alternatives for Papua New Guinea's housing crisis

Caption: Clay bricks, which can be easily made in PNG, could help ease our housing crisis

 

A senior Papua New Guinea public servant studying in the United Kingdom has supported calls by Nasfund joint chief excutive officer Rod Mitchell for the housing crisis in the country to be addressed.

Reichert Thanda, an assistant secretary with the Department of National Planning and Monitoring who is currently studying for his masters at the University of Bradford, said the crisis needed to be addressed with a sense of urgency.

“I fear for the worse because, if the relevant stakeholders including the government are not taking appropriate steps to address the housing issue, then this really is a crisis situation given huge projects like the LNG which is expected to employ close to 5-7000 people,” he said.

Mr Thanda proposed steps that relevant stakeholders could apply in addressing this “potentially dangerous” situation:

·        Form a national multi-stakeholder committee comprising key central agencies like Treasury, Finance, Planning and the PM’s Department to as part of the urbanisation policy to free up customary land within the periphery of the Port Moresby City (through registration and leasing of customary land to private investors and individuals to build their houses);

·        Two options: engage youths in manufacture of bricks through supervision by perhaps Habitat for Humanity (e.g. case of Ghana, Philippines, etc). The aim is to build more houses for less (e.g. with K1 million we should aim to build between 20-30 houses as opposed to 5-10 houses through some private sector construction companies). Habitat for Humanity can even partner with our local steel manufacturing companies to get subsidised steel for construction of cost-effective but quality steel houses;

·        Open up and expand the financial and banking sector so that credit facilities are made available including through Nambawan Super and Nasfund. Why not members obtain housing loans directly from Nambawan Super or Nasfund including the saving societies instead of the banks? The market for credit facilities in PNG is completely underdeveloped for average income earners to invest in such properties in order to improve their living standards.

·        Government through a Cabinet decision must allocate K1 million each for staff housing from next year’s Development Budget (starting with central agencies and line ministries and eventually to the provinces) which can be used as either collateral or applied in a scheme describe in point;

·         In light of the LNG project, Government must quickly formulate a single structure salary system instead of the current discriminatory dual system; and

·        The same committee with National Capital District Commission should plan for the city’s expansion immediately.

“While the above proposals are not limited in scope, I am sure it will generate a lot of bright ideas from the people of PNG,” Mr Thanda said.

“Let’s not look to the foreigners to provide us with solutions but look around to see how we can utilise existing skills and resources to improve the lives of our fellow citizens.

“Let me therefore conclude with this quote from Marcel Proust: ‘The real voyage of discovery consists not in seeking new lands but seeing with new eyes’.”

 

Former Marathon executive to head InterOil LNG project

Pacific LNG Operations LTD, an affiliate  of Switzerland based Clarion Finanz AG, a substantial indirect interest holder in the Elk and Antelope discoveries  and 47.5% LNG partner in Liquid Niugini Gas Limited with InterOil Corporation (NYSE-IOC), is pleased to announce that Mr Henry Aldorf has joined as President of Pacific LNG and a director of Liquid Niugini Gas Limited. 

 Mr Aldorf was most recently the President of Marathon International and Vice-President Global Upstream of Marathon Oil.

 Mr Aldorf has 37 years of experience in the petroleum and chemicals industry, the last nine of which have been with Marathon Oil.

 Prior to his most recent role with Marathon leading worldwide upstream business development, including upstream commercial strategy and negotiations, Mr Aldorf held the positions in Marathon Oil International of Senior Vice President International Business Development, Senior Vice-President West Africa, Middle East and Asia Business Development, and Senior Vice-President West Africa Business Development .

 In the latter position Mr Aldorf was responsible for Marathon's EG LNG project in Equatorial Guinea and was the first Managing Director of EG LNG Co.

 Mr Aldorf is reunited with his former Marathon Equatorial Guinea LNG team members, Mr Andy Mitchell and Mr Wayne Hamal, both currently with Liquid Niugini Gas and InterOil.

 They were all part of the team responsible for designing, partnering, and executing the Equatorial Guinea (EGLNG) LNG plant.

 he EG LNG development was completed in the shortest time ever for an LNG project. Mr Aldorf stated: "I am glad to be back working with this experienced group to further the final execution of this exciting Liquid Niugini Gas LNG project in Papua New Guinea.

 "The gas resource in Elk and Antelope is onshore and a great liquids rich gas asset.  We are anxious to move forward with solid LNG partners and complete this project on time and on budget," Mr Aldorf said.

 ###

For Further Information, Contact:

Mr Susuve Laumaea

Senior Manager – Media Relations/Public Affairs

PNG Operations

Tel: 675-3217040

Cell: 675-72013870

Email: Susuve.laumaea@interoil.com or slaumaea@digicelpacific.blackberry.com

Housing bombshell for Papua New Guinea!

Caption: Nasfund’s Malolo Estate at Nine-Mile.-Picture courtesy of Nasfund

Papua New Guineas will not be able to afford housing

Papua New Guineans will not be able to afford housing, despite the emergence of the LNG projects in the country, according to Nasfund joint chief executive officer Rod Mitchell.

He dropped the bombshell in a report on Nasfund’s Eight and Mile-Mile housing sub-divisions to members.

“The dilemma Port Moresby now faces is the LNG project,” Mr Mitchell said.

“LNG will accelerate the emerging middleclass, meaning a small but growing minority will be able to see home ownership within their grasp.

“The flipside is that the gas project will draw more citizens from rural areas around the country to Port Moresby on the false premise of jobs and the glamour of big town life.

“For most, it will be a heart-filled experience of loss of identity, poverty and disconnect from what is often a rewarding rural life and culture.

“A city of half a million inhabitants is expected to swell in the next decade to over a million, of which most will reside in the exploding settlements on the outskirts of Port Moresby.

“If we believe we have a housing problem now, we do not believe we have seen the worst of it.

“And clearly we need to continue the discussion until we bridge housing reality with housing expectations.”

Mr Mitchell said the housing affordability debate would and must continue.

“The reality is that in the absence of higher family disposable income and a very-visible middle class, housing as currently being offered will remain unaffordable for most,” he said.

Mr Mitchell said in discussing housing affordability, a number of issues present very clearly:

·        Lack of a middle class that can afford the cost of a dwelling;

·        Banking, funding, superannuation and savings; and

·        Housing expectations cannot be met at an affordable price;

“Firstly, in the absence of a readily-identifiable middle class, there remains a lack of savings and disposable income to purchase a dwelling,” he said.

“This can be starkly illustrated in comparison to Australian home ownership.

“In Australia, the average disposable income is approximately $A50, 000 and average house cost (Melbourne) is $A440, 000.

“This means that the average house is valued at approximately nine times a workers salary.

“In PNG it is 24 times an average workers salary.

“If we look at family income, the house to income ratio falls to 5.8 in Australia and 16 times in PNG.

“Clearly the average family and or worker in Papua New Guinea do not have the income generation to meet the current cost of housing.”

Commenting on bank funding, superannuation and savings, Mr Mitchell said the cultural aspect of communal sharing, family obligation or wantokism tended to reduce disposable income and savings levels dramatically.

“Typical savings patterns of a private sector worker tend to be dominated by their superannuation, both at the compulsory component and often extra superannuation contributed voluntarily, to avoid extended family pressures from accessing savings,” he said.

“In effect, superannuation is often the only safe guard a worker has for savings accumulation and protection.

“However, having said this, if we assume the average worker is earning somewhere between K10,000 and K14,000, the employee share of their superannuation balance will after five years be around K5, 600.

“This amount will still fall well short of the deposit required for a dwelling (K30, 000 to K 40,000 based on 10% deposit for a dwelling at Eight-mile).

“Superannuation is clearly part of the housing affordability equation but not the full solution.

“Similarly, bank finance has now tightened.

“Government also has charges, the largest being stamp duty on the purchase of house which amounts to 5% of the purchase price.

“Banks are also looking very carefully at the credit worthiness of borrowers.

“Loan default is costly not only on the borrower but the bank as well.

“Evidence suggests that up to 15% of all housing loans at anyone time tend to be in arrears and subject to foreclosure.”

Mr Mitchell concluded that housing expectations could not be met at an affordable price.

“The lessons learned from Eight and Nine-Mile is that land servicing costs, irrespective of the price of the land, is expensive,” he said.

“Services such as bitumen roads, electricity, sewage, fencing, water can cost anywhere between K65, 000 and K80, 000 per block.

“Add the price of land – say K60, 000 and you have a base cost of K125, 000 per serviced block of land.

“Base housing costs tend to work out at K2, 000 per sq m.

“A typical 90 sq m dwelling will cost around K180, 000 to build.

“Therefore, a house and land package will cost in the vicinity of K300, 000 before we include developer’s margin (the developer does not construct for free) and cost of finance.

“Also, construction delays cost the project more as interest accumulates.”

Madang Resort opens access for boats

Over the past three months, Andrew Malagan has been operating the Madang Resort back hoe/loader dredging a channel for small banana boats to operate in and out of the beautiful inner lake providing access to scores of banana boats to reach the colourful Madang markets (pictured).

 The project is apart of the Madang Resort's community projects which has seen the redevelopment of the Graged fish market and seawall to protect erosion from the rising seal level.  

The finished project will provide up to 20 barbeque areas under the shelter of traditional houses, with water and lighting with places for clients to enjoy the local fish cooked by Graged women, who have also contributed K5, 000 towards the fish market.

 Managing director of Madang Resort, Sir Peter Barter, said the project would take a further six months to complete and so far has cost the company more than K400, 000. 

“In return, the project will provide a means for the Krangket women to be economically independent, provide inexpensive local sea food for visitors cooked under hygienic conditions, a place where visitors can enjoy the beautiful location of Yamilon Lagoon, and the island and coastal people will now have boat access to the markets with the newly-dredged channel. 

“As apart of the agreement, a total ban on the sale of buai is in force in the project area.

“As a further service, the dredged karanas will be used to maintain the roads in the area around the township.

“This karanas has been particularly suitable for filling pot holes in the past.”

Australian surfers help Papua New Guinea counterparts

In search of the perfect wave at Ulingam Bay in Bogia, Madang province.-Picture courtesy of PNGSA

Excited Bogia, Madang province youngsters with their new surfboards last November, which were handed over by the SAPNG. Tupira Surf Club patron Justice Nicholas Kiriwom and president Al Mom received the boards from SAPNG president Andrew Abel, secretary Richard Farrall and board members Nick Studdy and Chey Scovell

Surf culture tends to place a high value on fellowship, kindness, and cooperation, with surfers helping each other out when they can and working together towards common goals.

In line with this, the surfing fraternity in Australia has come to the aid of the fledgling Papua New Guinea surfing community with a generous donation of boards, equipment and clothing which have been distributed to surfing clubs in PNG.

The goods arrived last year and the PNG Surfing Association has distributed them to the 10 clubs in PNG which include four in Vanimo, three in Kavieng, two in Port Moresby, and the baby of them, Tupira Surf Club of Ulingam Bay in Bogia, Madang province.

PNGSA president Andrew Abel said the surfboard donation programme started when Australians Saiid Metwali and Jamo Borthwick spread the word among the surfing fraternity there of the need to help aspiring surfers in PNG.

Surfing communities from Noosa in Queensland all the way to Sydney, NSW, collected boards, equipment and clothing which were shipped to PNG in a 20ft container.

“This relationship between the SAPNG and companies and individuals in Australia, will essentially create a long-term bond between our two countries, break down the negative perceptions and create positive awareness of PNG and what we have to offer by way of tourism,” Mr Abel said.

“Through this, SAPNG with our partners like Coastal Watch Australia and Surfaid International will help to bring about development through SAPNG as a conduit to village communities throughout PNG where surfing communities have been established.”

Bogia’s Tupira Surf Club, which has been established by Supreme Court judge Nicholas Kiriwom, was the first to receive its boards last November with the presence of Pacific Beat host Tania Bale, who will show footage of the event on the popular ABC television programme next month.

Mr Abel said negotiations were ongoing for a surfing cultural exchange programme involving the children of Bogia and a school in Gold Coast, Queensland, in order for them to experience different cultures and ways of life.

Further information can be sourced from the SAPNG website http://www.surfingpapuanewguinea.org.pg/.

Datec's new store heralds a new dawn for ICT in PNG

First-day customers at the Datec Megastore Internet cafe.-Pictures by AURI EVA

Another first for PNG at Datec is the Bose range of audio equipment

The Apple iMac, the ultimate all-in-one desktop computer is now available at Datec in a first for PNG

Customers filing out of the new Datec Megastore yesterday with boxes of hi-tech goodies

Datec PNG today achieved a monumental milestone by openings its state-of-the art Megastore at Gordon along the Poreporena Freeway.

The Megastore, which is open seven days a week is located at Steamships commercial property development in Gordon, and heralds a new dawn for information and communication technology (ICT) in Papua New Guinea with the LNG project coming on stream.

The complex also houses the brand-new Datec Leaning Centre which aims to bring world-class ICT education to PNG.

Datec chief executive officer Bhanu Sud was a relieved man today after months of hard work in the lead-up to today's opening.

“Datec has achieved a monumental milestone by opening its state-of-the-art Megastore that is focused on our customers enjoying e-lifestyle experience,” he said.

“This is the biggest one-stop shop in PNG.

“There’s enough parking space for over 60 customers.”

The new Datec Megastore is 50% bigger than the old one and will enable the company to showcase its full range of products and offerings.

“We’re committed to providing our customers with a one-stop shopping experience,” said retail director Rob Masters.

“We represent some of the leading brands like Canon, IBM, Lenovo, HP, Microsoft and a host of other smaller brands and pride ourself in being a one-stop shop through our new store and our showroom in Lae.

“We realise that there is a growing need in the small to medium business and in the home for latest technology products like PCs, notebooks, scanners, UPS, communications products, entertainment, digital photography and multi-media solutions.

“We represent PCs and notebooks from leading industry manufacturers such as IBM, Lenovo, Acer, and our recent additions the Apple iMac and MacBook range…”

“In addition to these leading brands, we also assemble our own brand of PCs, the Datec iSystem in both standard and build-to-order models, which gives both quality and cost-effective solutions.

“We carry a full range of networking communications multi-function printers, digital cameras, multi-media solutions and more recently the Sony range of products to our line.”

Hundreds of excited customers flocked into the Megastore today to see Datec’s latest hi-tech offerings.

K10,000 bounty for wanted criminal

POLICE have offered a K10,000 reward for the recapture of fugitive bank robber William Nanua Kapris  (pictured) who escaped from the Bomana maximum security facility with 11 others lastTuesday, The National reports.
Acting Police Commissioner Tom Kulunga announced the bounty last Friday saying the reward would be paid to anyone providing information leading to the recapture of Kapris.
At the same time, Bank South Pacific is offering “cash incentive” in full page newspaper advertisements for any information that may prevent a bank robbery, fraud or kidnapping of senior bank executives. 
 Also on Friday, acting Internal Security Minister Sam Abal appealed to the 12 hardcore prisoners, including Kapris, to surrender.
Last week’s heightened tension following the breakout also resulted in Port Moresby police shooting and killing two well-known criminals at Gerehu.
 On the K10,000 reward, Mr Kulunga said: “The decision to post the reward was made in the interest of public safety.
“It is quite obvious Kapris’ escape has caused much fear and anxiety to the public, especially business houses. 
“Kapris also poses a threat to state witnesses as well as police personnel if he remains free.”
Mr Kulunga thanked the Government for providing the K10,000 reward money as well as other funds (totalling K3 million) for the security operations aimed at recapturing Kapris and other highly dangerous fugitives. 
Mr Kulunga urged the public with information to contact NCD Metropolitan Superintendent Fred Yakasa  at 3244 282 or 73302030, or Superintendent (Operations) Andy Bawa at 3244 228 or 76858631.
Mr Kulunga assured that all information would be treated as confidential.
“For security reasons as well as for identification for payment purposes, informants may be required to provide a code or secret name when giving information," he said.
“This code or secret name will only be known by the informant and any one of the two officers the informant is in contact with.
“I am appealing to everyone to work with police to recapture Kapris and make our society safe and secure again.”