Papua New Guinea is undergoing economic and social transformation. It is one of the most diverse countries in the world; home to over 11.78 million people and more than 800 different languages spoken among a population divided into more than 10,000 ethnic clans across 600 islands.
Papua New Guinea (PNG) is the world’s most linguistically diverse country, with over 850 indigenous languages. It comprises the eastern part of the island of New Guinea; the islands of New Britain, New Ireland, and the Autonomous Region of Bougainville; and 600 smaller islands and atolls. Its rich geographic and natural resources include large reserves of valuable minerals, vast forests, abundant water and marine resources, and fertile land for agriculture.
PNG’s population of about 11.8 million people is young and growing. The country’s rich culture is complex and deeply rooted in tribal and ethnic identity and relationships to the land, which contribute to the country’s unique challenges as well as its considerable resilience.
Two broad sectors dominate the economy. Agricultural, forestry, and fishing employ most of the labor force (the majority employed informally). Minerals and energy extraction account for most export earnings and GDP.
Despite a challenging external environment, the economic outlook remains broadly positive, driven by strong performance in agriculture, a key contributor to economic recovery and long-term prosperity.
PNG’s modest headline economic growth has translated into limited per capita income growth over the past 40 years. Macroeconomic volatility, low productivity growth, heavy reliance on natural resources, and missed opportunities to take full advantage of its human capital have constrained growth, according to the Country Economic Memorandum for Papua New Guinea. To achieve stronger and more inclusive economic growth, the country needs to increase economic stability; boost productivity; nurture human capital, including by improving gender equality; and enhance physical infrastructure, including electricity, telecommunications, and road and other transport infrastructure that is critical to private sector–led growth.
Last updated: May 2025
The World Bank continues to support the government’s efforts to strengthen macroeconomic management and improve service delivery, to ensure that development benefits reach all the people of PNG, particularly 85 percent of the population living in rural areas.Its approach is guided by theCountry Partnership Framework for Papua New Guinea, which is closely aligned with PNG’s development plans. That framework lays out three focus areas:
Improving macroeconomic and fiscal resilience;
Providing more effective and inclusive services, particularly in remote and underserved areas;
Diversifying the economy and creating jobs, including outside the natural resources–based sector.
The strategy is underpinned by the aims of strengthening governance in the natural resources sector and in the management of public resources. It aims to ensure that everyone, regardless of gender, location, and/or social and economic circumstances, can benefit equally from the World Bank’s work to support PNG’s development goals.
Download Our Work in the Pacific & PNG (March 2025), the guide to the World Bank’s work across the Pacific. It includes a map of the Bank’s work across the Pacific and program break-downs by country.
(888 kb PDF file)
The Australian and New Zealand governments support the World Bank’s work in the Pacific and PNG, through the PNG and the Pacific Islands Umbrella Facility (PPIUF).
Key Areas of Financial Support
Working in partnership with the government, the World Bank is currently supporting 11 active projects across infrastructure, income and jobs, and social sectors in PNG, with commitments totaling US$663 million.
(i) Infrastructure
In infrastructure, the WB is supporting the transport, energy, and water sectors. Within the transport sector, the US$108 million Resilient Transport Project is funding the rehabilitation of key sections of the Ramu highway and the extended maintenance of nearly 200 kilometers (km) of critical transport links.
In the energy sector, the US$30 million Energy Utility Performance and Reliability Project (EUPRIP) is supporting the rehabilitation, reinforcement, and upgrade of infrastructure on the Port Moresby, Ramu, and Gazelle grids owned and operated by PNG Power Limited. The newly approved US$204 million National Energy Access Transformation (NEAT) project will scale up the Bank’s support in the sector by connecting more households and businesses to electricity, particularly in the rural areas, expanding renewable energy generation, and supporting the modernization of the country’s electricity infrastructure.
The WB is also supporting the upgrading of water supply infrastructure in provincial and district towns through the US$70 million Water Supply and Sanitation Development Project. Finally, the Rural Service Delivery Project (RSDP), is providing US$23 million in support for community driven development infrastructure projects.
(ii) Income and Jobs
The US$40 million PNG Agriculture Commercialization and Diversification Project builds on the success of the US$75 million Productive Partnership in Agriculture Project, which supported efforts to build the skills, productivity, and access to markets of more than 67,000 coffee and cocoa farmers. The new project continues to support coffee and cocoa growers as well as farmers of small livestock and crops such as coconut and spices.
The US$32 million Enhancing Labor Mobility from Papua New Guinea project is helping ensure equitable access to rapidly expanding employment opportunities in Australia and New Zealand, with a focus on women and disadvantaged groups, and preparing workers for deployment to Australia and New Zealand and reintegration on return to PNG.
The US$ 35 million Urban Youth Employment Project prepares the youth in urban areas for the job market by providing them with temporary employment opportunities through the urban works program, and internship and Technical and Vocational Education and Training (TVET) programs.
(iii) Social Sectors
Within the Social Sectors, support so far has been concentrated in the health sector. The US$90 million PNG Child Nutrition and Social Protection Project provides child grants to pregnant and lactating mothers to be used for purchasing food and nutrition supplements in order to reduce child malnutrition. It also supports the implementation of the PNG CARES (Community-based Approach to Reduce and End Stunting) initiative, delivering improvements to nutrition-focused health services at provincial health centers throughout the country. The US$ 30 million Improving Access to & Value from Health Services (IMPACT) Project seeks to improve the quality of primary health care by improving governance systems and upgrading health facilities so that they meet minimum service standards.
Support through Analytical Services and Advisory
The Bank also provides analytical services and advisory in order to inform policy and investment decisions. For example, the Bank prepares annual Economic Updates and in 2023 it published its flagship comprehensive report on PNG’s economic challenges and prospects, the Country Economic Memorandum.
Last updated: May 2025
Poor road conditions in PNG make travel by road impossible, unsafe, or too expensive for many people. Without reliable access totransport infrastructure and roads, people cannot reach schools, hospitals, or markets when they need to. Under the recently closed Road Maintenance and Rehabilitation Project, PNG restored more than 236 km of critical road links across the country and rehabilitated, maintained, and/or replaced more than 50 national and provincial bridges, benefitting an estimated 1.3 million people (27 percent of the population).
High rates of drug-resistant tuberculosis (TB) pose a significant health threat in several provinces of PNG. TB is a leading cause of death in PNG, the country with the highest proportion of children affected by the disease. A successful community-based TB treatment program funded by the World Bank but which is now closed supported efforts by communities across the National Capital District (Port Moresby) to help eradicate this deadly disease. The program was first piloted in Western Province on Daru Island,where the World Bankcontributed US$15 million to the Emergency Tuberculosis Project to improve screening, diagnosis, and treatment programs. Patient treatment drop-out rates have fallen from 30 percent to zero on Daru Island, once one of the world’s most significant hotspots for multidrug-resistant TB.
In the capital, Port Moresby, the US$35 million Urban Youth Employment Project II is helping improve the capacity of young men and women to engage in productive income-generating activities. Its predecessor, the Urban Youth Employment Project (UYEP), provided 18,500 unemployed people (40 percent of them women) with vocational training and fully subsidized work placements, creating over 815,000 days of work. UYEP II extends the program into Lae, PNG’s industrial hub and second-largest city.
The World Bank provides free and open access to a comprehensive set of data about development in countries around the globe, including Papua New Guinea.
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