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THE INDEPENDENT State of Papua New Guinea is considering turning to the capital markets for financing to help bridge a projected budget deficit of 2.9o for the 1999 fiscal year.
Deputy prime minister Iairo Lasaro told Euroweek that a government delegation is currently in Australia with the aim of canvassing the banking community for possible options.
Lasaro said that although the country continues to be able to rely on Australia for concessional funding - receiving about $175m per annum or 8% of 1998 exports - it has not received any fresh funds from the World Bank on which it was previously dependent.
Relations with the supranational broke down after the government hired World Bank official Pirouz Hamidian-Rad as chief economic adviser to prime minister Bill Skate, despite express rules forbidding staff from immediately accepting governmental jobs.
A World Bank delegation should arrive in PNG within the next few weeks, however, with the aim of resuming talks.