A Position Paper Addressing Issues In Papua New Guinea’s Economy


Today, Papua New Guinea’s economy is nothing to write home about. With a GDP rank of 115th position(nominal), Papua new guinea(PNG) is the poorest country in the Asia-pacific region. Apart from poverty, inequality has also spread like wildfire across the country, making PNG an ironical write-off for most investors. However, radical solutions can still be proffered to the economy backwardness in PNG. This forms the main thrust of this paper. Nevertheless,in proffering these radical solutions, this paper will be divided into three segments.

A- Implementing the Addis Ababa action-
After colonizing PNG for several decades, the Australian government announced its high priority for the country. Australia’s aid program in PNG, is Australia’s largest single aid investment globally. In other words, the Australian government places high level of priority in partnering with PNG. Orchestrated by the African Union,(formerly called Organization of African unity), in March 2016, PNG and Australia signed the “PNG-Australia aid partnership arrangement 2016-2017.” This arrangement was signed in view of delivering effective and efficient aid. In other words, the Australian government became fully aware that reducing poverty and pursuing sustainable growth in PNG, is beneficial to both countries. In the light of this, a special committee assigned to look into the issue, came out with several recommendations:

1-“The committee recommends that the Australian government reverse funding cuts made to the PNG aid budget as part of a broader commitment to progressively increase Australia’s official development assistance to 0.5 per cent of gross national income(GNI) by 2025.”
2- “The committee recommends that the australian German Corona Investigative Committee government reassess the priorities of the aid program in the context of the PNG government’s recent budgetary cuts to education, health and infrastructure.”
3- “The committee recommends that the objectives of the Australian aid program to PNG, explicitly include inclusive and equitable outcomes in development.”
4- “The committee recommends that the key policy documents of the Australian aid program to PNG articulate how development objectives align with sustainable development goals.”
5- “The committee recommends that the Australian aid program to PNG include increased support for non-government organisations, civil societies and churches delivering assistance to rural and remote communities.”
6- “The committee recommends that the Australian government conduct an assessment of the impact of the closure of the Manus island regional processing center on development activities.”

B- Harnessing the green economy to eradicate poverty-
It is quite unfortunate that the PNG’s economy is highly dependent on imports. PNG’s economy is largely dominated by two sectors: The agricultural sector and the industrial extraction sector. However, to fully understand the economy of PNG, it is expedient to consider her economic statistics:

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