Can PNG government not pay its debts? – New Zealand company still not paid two years later
Despite a court ruling, the PNG government still has not paid its outstanding debt. All legal processes, including
sign-off by the Solicitor General, have been met. The certified judgment was served early November for payment, yet, the
Department of Finance has not made the payment.
Calls and emails are not being returned by the Department of Finance to company representatives. This means the New
Zealand company and staff go into a third Christmas break with no payment for work completed in 2014.
In June 2015, Wellington company Evaluation Consult (ECNZ) won its court case in Papua New Guinea to recover New Zealand
$500,000 debt. Despite pressure from New Zealand Foreign Affairs Minister Murray McCully, PNG’s High Commissioner to New
Zealand, and others, the PNG government ignored the ruling. The debt has been outstanding since 2014.
After delays, in June 2016 the National Court provided the court certificate to the Solicitor General, under the Claims By and Against the State Act to sign the National Court certificate. After even further delays the certificate was signed and served on Department
of Finance for payment in November 2016.
ECNZ has received no reason for non-payment and there has been no communication to ECNZs company lawyers. There seems to
be no action by Department of Finance to ensure PNG government pays its outstanding debt.
ECNZs Executive Director Kate Averill says, “As far as we know, no one else has taken the matter through the PNG legal
system. This has been an expensive process and the only result has been to learn the PNG government does not honour its
debts or comply with its own law.”
In 2014, Evaluation Consult was invited by the PNG government to support developing a national strategic sustainable
development plan. “It was a farsighted initiative and important for the future of the country. The project involved
working with all 35 sectors of government from forestry and fisheries through to mining and manufacturing. Ironically,
it also included the law, order and justice sectors”, says Kate.
New Zealand Foreign Affairs and Trade promotes PNG as a place for companies to do business. However, for PNG to succeed
as a modern economy its government must act ethically and within the law. This type of behaviour threatens national and
international partnerships that contribute to PNG development.
Evaluation Consult is a specialist results-focused governance, management, planning, monitoring, and evaluation
business. It has worked alongside other Pacific nations without any issues. ECNZ suggests, New Zealand and international
businesses be cautious when securing contracts with PNG government requesting that full payment is received in advance
and held in an escrow account operated by an entirely independent third party.
The company is once again calling on the PNG government to act honourably, comply with the court ruling, and pay its
debt.