BRIEF July 19, 2019

Papua New Guinea Country Partnership Framework 2019-2023

Papua New Guinea (PNG) is one of the world’s most diverse nations. With immense natural resources, a young population and geographic location on the edge of Asia, PNG has huge opportunities and potential. However PNG is faced with major challenges, including an economy that is reliant on extractives but has seen few people benefit. The World Bank Group’s new Country Partnership Framework for Papua New Guinea will guide the work of the World Bank and International Finance Corporation (IFC) in PNG in the coming years.

World Bank Group


About the Country Partnership Framework

The World Bank Group’s Country Partnership Framework (CPF) FY2019 — 2023 lays out the strategy and aims of the World Bank Group’s future work in Papua New Guinea over the coming years.

The Country Partnership Framework is aligned with Papua New Guinea’s Medium Term Development Plan for 2018-2022 (MDTPIII), as well as the PNG Development Strategic Plan 2010-2023 and Vision 2050.

 It is underpinned by a Systematic Country Diagnostic (SCD), the World Bank Group’s comprehensive analysis of the opportunities and challenges for PNG to end extreme poverty and increase shared prosperity in a socially and environmentally sustainable way, and builds on consultations with national and provincial governments, the private sector, civil society and academia.

The new strategy also builds on work undertaken under the World Bank Group’s previous Country Partnership Strategy (2013-2018) which has delivered support to more than 67,000 coffee and cocoa growers through the Productive Partnerships in Agriculture Project, work placement and skills training for more than 18,000 unemployed young Papua New Guineans in the National Capital District delivered through the Urban Youth Employment Project, and access to basic solar lighting and phone charging for the first time for more than 1.8 million people through IFC’s Lighting PNG program.

Key Focuses of the Country Partnership Framework 2019-2023

The World Bank Group’s new Country Partnership Framework aims to help PNG foster sustainable and inclusive growth and manage social and economic risks through three key focus areas. These are:

1.       Improve PNG’s macro and fiscal resilience;

2.       Ensure more effective and inclusive services, particularly in underserved areas; and

3.       Encourage private sector growth and jobs in the non-resources sector.

Strengthening governance in both the natural resources sector and across management of public resources will guide the program as a whole.

 


A closer look at each Focus Area

1)      Improving macro and fiscal resilience

  • Support for improvements to macroeconomic policy, and encouraging effective implementation will go a long way to ensuring that:

 - the economy is appropriately insulated from commodity-price-induced volatility;
 - that public services are adequately funded;
 - that the private sector and international capital can count on stability and growth; and
 - that a broad range of risks (debt, balance of payments, and inflation, for example) are well under control.

  • Help to strengthen fiscal management and build resilience in the country and help address vulnerabilities in the macroeconomic environment.
  • Continue support improvements to tax administration and fiscal resilience against climate change and natural disasters, including through a disaster risk financing strategy.
  • Support for improvements to governance in the resource sector.

2)      Ensuring more effective and inclusive services, particularly in underserved areas

  • Help improve the quality of public spending on services
  • Work to improve access to key services for people, including help to strengthen frontline health services.
  • Help improve access to clean water, and sanitation in areas where poverty is most prevalent.
  • Help to boost people’s access to electricity and development of renewable energy, including by working with the private sector.
  • Improve community access to basic infrastructure and services, particularly in vulnerable areas, where community driven development will be critical for access and maintenance of infrastructure.
  • Improve access to affordable housing, including through private sector investments.

3)      Encourage private sector growth and jobs in the non-resources sector.

  • Improve the competitiveness of PNG’s micro, small and medium sized businesses and increases in the supply of finance to micro borrowers.
  • Boost number of people with mobile banking accounts, access to digital services and increasing competition across the financial sector to spur innovation.
  • Continue support to help PNG develop a corporate bond market, including through a private sector bond.
  • Improve competitiveness and productivity of agriculture and tourism, including help for small and medium sized farmers to improve crops and competitiveness, especially with key crops such as cocoa, coffee and coconut; as well as help to farmers for adoption of new technologies.
  • Help develop PNG’s tourism to create jobs, especially for unskilled and semi-skilled Papua New Guineans. 
  • Boost job opportunities for young people and women, including by building on existing programs to help vulnerable urban youth to gain skills, with a particular focus on young women.
  • Aim to increase women’s economic empowerment, by building on IFC’s work efforts to provide practical solutions to business to advance gender equality; and with the World Bank exploring a violence prevention pilot program in the key cities and urban areas.