BPNG record foreign currency intervention to meet import demands in 2023

The demand for foreign currency outmatched revenue inflows from exports. 

Governor Elizabeth Genia says “for 2024, current account deficit of [US$] 962 million is expected, due to high net outflow in the financial and capital account exceeding surplus in the current account.  

“We [BPNG] are not seeing enough of what we export come back on shore into PNG [which is getting] closer attention of Bank of PNG and [Department of] Treasury.”

Last year, BPNG removed the highest foreign currency from its reserves to meet importers demand.

Ms Genia says “BPNG intervened in the market with US$ 1,6 billion, [a] record level of intervention by the Central Bank [from the] account surplus [of] 200 million.

“In 2023, commercial foreign current inflow into PNG domestic financial market amounted to [US$] 5.5 billion against out flows of [US$] 7.2 million,”

She says the adequate reserves kept at BPNG built in the last decade was “driven by the mineral sector [especially revenues from] LNG exports, copper and gold.”