AUSTRALIA PROVIDES FINANCIAL SUPPORT TO PAPUA NEW GUINEA

The Australian Government has provided a A$133 million loan (equivalent

to US$80 million) to the Government of Papua New Guinea. This loan has

been provided following a request from the IMF and is in support of the

.png Governments recent agreement with the IMF on a Standby Arrangement

and the World Bank on an Adjustment Loan.

This assistance replaces a short-term financial support facility of US$80

million that was provided by Australia in December last year.

The loan will support.pngs foreign reserves and the.png Governments

efforts to reduce its debt to the Bank of.png. It will also underpin.pngs

on-going economic and governance reform efforts. In so doing, Australias

loan will also contribute to a further strengthening of investor and donor

confidence in the.png economy.

The provision of the loan is recognition of the considerable gains that

have been made in Papua New Guinea under the leadership of Prime Minister

Sir Mekere Morauta, and reflects the confidence the Australian Government

has in the Morauta Governments commitment to further advancing Papua

New Guineas important reform agenda. It also complements the significant

financial and technical assistance already provided by Australia.

CANBERRA

22 June 2000