Papua New Guinea’s population of 7.7 million is young and growing. The country is rich with a vast endowment of natural resources and geographic proximity to rapidly growing Asian markets. Its population is strikingly diverse, speaking over 800 distinct languages.
Economically, PNG’s economy remains dominated by two sectors: the agricultural, forestry, and fishing sector, which engages most of the labor force (the majority informally); and the minerals and energy extraction sector which accounts for the majority of export earnings and Gross Domestic Product.
To diversify PNG’s asset base and increase employment, investment is needed to strengthen capacity in institutions, human capital, and physical infrastructure. Electricity, telecommunications, road and other transport infrastructure remain critical to enabling private sector-led growth.
Obtaining more revenue from the mineral and petroleum sector by discontinuing the practice of providing significant tax concessions to companies operating in this sector will improve both the fiscal balance and the foreign exchange position in PNG. Further, translating revenues from strong, tangible improvements to living standards for all Papua New Guineans remains the key challenge for the Government of PNG, yet other challenges are also immense. It is inherent to improve public financial management and efficiency of public spending to convert resource revenues into inclusive growth and, consequently, a genuine improvement in the livelihoods.
Last Updated: Sep 28, 2016