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Papua New Guinea could lose $100.4 million EU grant for small farmers

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Christian Fernsby ▼ | June 23, 2019
Papua New Guinea farmer
Pacific   Papua New Guinea farmer

Papua New Guinea is on the brink of losing a K340 million ($100.4 million) European Union grant for small holder farmers if the Government does not sign off the Enterprise Development Fund (EDF) agreement, East Sepik Governor Allan Bird says.

If the Government fails to sign by the end of the month, EU would back off with the “free money”, he said.

“The money is at great risk of going back to the EU,” Bird told FM 100’s Talk Back Show.

EU’s EDF is funding a pilot programme in PNG and the Pacific, creating enterprises for small holder vanilla and cocoa farmers of East and West Sepik. Bird said the programme was secured with an offer made by the EU headquarters in Belgium, which only needed one signature before PNG could access the grant.

“Brussels has already approved it. Their finance minister has already signed,” he said.

“There are three copies of the documents sitting here in PNG. It just needs one signature from PNG and you get K340m in foreign currency hit the central bank tomorrow.

“The problem is that certain people in planning now, after the money has been approved for something totally different, want to change the scope.

“The problem with donor funds is when you borrow money, you can do whatever you want to with the money. If it’s your own money, you can do whatever you like.

“But if it’s grants, it’s a tied grant. They are tied to very specific things to achieve specific outcomes and achieve impact.

“If you cannot get the outcomes, you cannot get the impacts then basically the programme fails.”

Bird said Prime Minister James Marape made a commitment that someone was going to sign it before the deadline.

However, Minister for National Planning and Monitoring Richard Maru said the people of East Sepik and the governor “need to understand that donor funds do not belong to one particular province; they belong to the Independent State of Papua New Guinea”.

“Work on this project began back in 2014 and EU has already agreed that the project will cover the four Momase provinces,” Maru said.

“This is not a Constitutional grant for the people of East Sepik, it’s a donor funding to the national government through the Department of National Planning and Monitoring.”.

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