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Wednesday, 26 September 1973
Page: 1598

Mr Snedden asked the Minister for External Territories, upon notice:

(1)   Can he indicate the total estimated value of Japanese investment in Papua New Guinea.

(2)   If so, what are the main geographical areas in which this investment occurs.

(3)   In which main industries and developments is Japanese investment involved.

(4)   Are Japanese investments in Papua New Guinea secured by the Japanese Government; if so, how.

(5)   Are Japanese investors able to borrow money for such investments at rates as low as 0.5 per cent; If so, under what arrangements is this done.

Mr Morrison - The answer to the right honourable member's question is as follows:

The matters referred to fall within the authority of Ministers in the House of Assembly for Papua New Guinea. The Ministers for Finance and Foreign Relations and Trade have provided the following information -

(1)   The total direct Japanese investment in Papua New Guinea is currently estimated at $20m. This excludes loans made by Japanese companies to the Bougainville copper project.

(2)   The main geographical areas in which this investment occurs are East and West New Britain, Madang, Morobe and Central Districts.

(3)   Japanese investment is mainly involved in timber utilisation, fishing, agricultural and mining ventures.

(4)   It is understood that Japan introduced during the 1950s a scheme for insurance of private overseas investment against risks of war, appropriation, nonconvertibility of foreign exchange, etc. It is not positively known that Japanese parent companies have taken out such insurance in respect of their Papua New Guinea enterprises although the expectation is they would have done so.

(5)   Japanese enterprises investing overseas have available soft loan finance and infrastructure assistance from Government institutions such as Overseas Economic Co-operation Fund and Japan Overseas Development Corporation provided their projects qualify for assistance under the laws relating to those organisations. OECF interest rates are understood to range from 3-5.5 per cent per annum. JODC provides assistance for infrastructure requirements by extending interest free loans involving only a servicing commission, usually 0.75 per cent per annum. Some Japanese projects in Papua New Guinea have attracted loan funds from both organisations.

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