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Document Abstract
Published: 2012

Papua New Guinea: critical development constraints

Papua New Guinea has strong economic growth yet marginalised remote areas
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Papua New Guinea (PNG) has enjoyed several years of strong economic growth, driven largely by high commodity prices and supported by structural reforms and some sound macroeconomic policies. However, the growing opportunities and wealth have been skewed increasingly in favour of a small and largely urban-based segment of the population.

The current paper addresses this issue and finds that:
  • challenges which PNG faces include: ensuring that the recent higher economic growth rates are sustainable in the long term, and translating high economic growth into much more inclusive development than has prevailed to date
  • the critical constraints encompass: weaknesses in governance and institutions, poor infrastructure, shortages of skilled human capital, and poor and unequal access to affordable and good-quality education and health services
Policy recommendations for the government are that:
  • vigorously apply the new informal economy policy in main and provincial centers and rural areas
  • review public sector terms and conditions - an independent review of the public sector is required
  • provide access to microfinance and other financial services, and place major emphasis on generating employment opportunities, including in agriculture
  • undertake a major program for raising the status of women in society, to empower women to participate more fully in, and benefit from, the economy, politics, and decision making
  • form innovative partnerships with private sector investment and participation in the delivery of public goods
  • help expanding the roles of civil society and NGOs and enhancing their skills to better fill their roles
In addition, the government is recommended to take measures to make competitive conditions prevail in PNG markets to enable consumers to secure a more efficient and wider range of services at affordable and more internationally comparable prices.
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M.E. Khan; Y. Niimi; M.R.M. Cham

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