Publication: Papua New Guinea Economic Update, May 2024: Invest in Your Children
Loading...
Other Files
245 downloads
Date
2024-05-28
ISSN
Published
2024-05-28
Author(s)
Editor(s)
Abstract
The economy has recovered to pre-COVID level but remains below its pre-COVID trajectory. The COVID-19 crisis led to an economic contraction in 2020-21 before recovering by 5.2 percent in 2022. The recovery in the extractive sector was driven by significant improvement in international prices of key export commodities, although the shutdown of the Porgera gold mine limited the rebound. Growth is estimated to have slowed down to 2.7 percent in 2023, primarily attributed to reduced global demand and domestic supply constraints stemming from scheduled maintenance in extractive facilities. Growth is projected to accelerate in 2024, mostly due to reopening of the Porgera gold mine. The mine restarted operations in 2024Q1 and is expected to reach its normal levels of production by mid-year. Meanwhile, growth could have been even faster, but brief violence and looting in January 2024 put a toll on the economy. According to the Business Council, the loss to the economy was not only from physical losses of assets and property, but also in forgone business revenue, which could lower tax collections and reduce the appetite to invest. In addition, the dispute between authorities and main fuel importer led to disruptions in fuel provision to businesses and households, further slowing down economic activity. The medium-term growth is expected to settle at 3 percent. There are both upside and downside risks to the outlook. The baseline projection does not account for potential new resource mega-projects, like Papua LNG. Thus, the final investment decision and the initiation of construction present an upside risk to the outlook. Meanwhile, slower-than-expected economic growth could materialize through lower demand for PNG’s exports, a more pronounced decline in commodity prices, and the impact of droughts and other climate-related events. Keeping up with the strengthened macroeconomic framework will help mitigate these risks.
Link to Data Set
Citation
“World Bank. 2024. Papua New Guinea Economic Update, May 2024: Invest in Your Children. © World Bank. http://hdl.handle.net/10986/41602 License: CC BY-NC 3.0 IGO.”
Associated URLs
Associated content
Other publications in this report series
Journal
Journal Volume
Journal Issue
Collections
Related items
Showing items related by metadata.
Publication Papua New Guinea Economic Update, January 2020(World Bank, Washington, DC, 2020-01-31)Papua New Guinea’s economy continues to face economic headwinds resulting from global and domestic economic uncertainties. PNG’s real GDP, despite rebounding to 5.6 percent in 2019, is expected to fall and hover at around 3 percent on average between 2020¬ and 2022, posing many negative risks, including exposure to unexpected external shocks or potential domestic political and economic turbulence. Projected GDP growth rates are lower than our previous forecasts, mainly due to delays in finalizing agreements and launching implementation of large new resource projects. The other major factor that impacted the downgrade in the growth outlook include heightened global uncertainty due to (i) a partial nature of the recent trade deal between the United States and China and (ii) a fresh emergence of new risks to Chinese and global growth, including a novel coronavirus. The report also provides an in-depth examination of the relationship between inclusiveness of growth and human capital (the health, knowledge, skills and resilience people accumulate). The report evaluates the implications of recent trends and policy reforms alongside the government’s stated development objectives, emphasizing that increased investment in human capital will be a critical prerequisite to achieving quality and inclusive growth in PNG.Publication Stagnant Stunting Rate Despite Rapid Economic Growth in Papua New Guinea(World Bank, Washington, DC, 2015-06)Maternal and child undernutrition is a pervasive and detrimental condition in Papua New Guinea. Despite rapid economic growth during the past decade, the stunting rate for children under 5, one of the primary indicators for child undernutrition, was estimated at 46 percent in Papua New Guinea in 2010, stagnant from 44 percent in 2005. This paper analyzes the association between the demographic, socioeconomic, environmental, and health-related factors on nutritional status for children under age 5 years, using the 2009–10 Papua New Guinea Household Income and Expenditure Survey. Stunting and underweight rates sharply rise in the first 24 months. Even in the better-off quintiles, children suffer from suboptimal breastfeeding and complementary food in the first 24 months. In general, the regression results showed that household wealth and geographic location are crucial factors that contribute to children’s malnutrition. More importantly, food quality, measured by protein intake, has significant predicting power on child malnutrition. Broadly increasing socioeconomic status and improving the quantity and quality of caloric intake are general steps to improving health outcomes in Papua New Guinea. In addition, three key areas were identified as critical to alleviating the persistent and detrimental stunting rate in the country: (1) exclusive breastfeeding and complementary food; (2) interventions by health workers; and (3) nutrition education.Publication Papua New Guinea : Country Gender Assessment, 2011-2012(Washington, DC, 2012-12)Papua New Guinea (PNG) became independent in 1976 as a constitutional parliamentary democracy. The country has four regions (Highlands, Islands, Momase and Southern) and 21 provinces including the autonomous region of Bougainville and two new provinces recently created in the southern and western parts of the highlands region. Another province-level division is the National Capital District, which comprises the capital city, Port Moresby. Each province is divided into electorates that vote for members of parliament as well as for a provincial member of parliament, who serves as the governor of the province. The country has a population of just over seven million, with an estimated population growth rate of 2.8 percent. Nearly half of PNG's population is under the age of 20 and the number of young people is expected to double in the next 20 years. Youth unemployment is high and rising, with only one in ten school graduates finding jobs in the private sector. With many young people leaving their villages in search of jobs in the towns and cities, there is a shortage of employment opportunities, which has contributed to the expansion of (mainly male) urban youth gangs, exacerbating problems of law and order.Publication Papua New Guinea Economic Update, September 2022(Washington, DC, 2022-09)The Special Focus for this issue is on long-term growth, emphasizing the challenges PNG is facing. The chapter identifies the underlying challenges of low and volatile growth in the country and aims at starting a public discussion to better understand the problems and, thus, contribute to finding solutions. The modest headline economic growth in PNG has translated into meager per capita income growth in the past four decades. While the economy expanded by 3.2 percent on average during 1980-2021, per capita GDP recorded an average annual growth rate of only 0.9 percent. The gap in per capita income level compared to peer countries has typically widened. Despite being at a similar level of development in the 1970s and some progress gained in the early 1990s, PNG’s income level is diverging away from the EAP region. This calls for a renewed policy focus on boosting economic growth. A new growth strategy would need to address the three interrelated growth challenges that the economy is facing: (i) excessive macroeconomic volatility; (ii) low productivity growth; and (iii) excessive reliance on natural capital and not enough on human and institutional capital.Publication Strategic Directions for Human Development in Papua New Guinea(Washington, DC: World Bank, 2007)There is an emerging consensus in Papua New Guinea (PNG) -- both at the governmental level and among civil society more generally -- that human development outcomes are far less than satisfactory and that service provision in many parts of the country is collapsing despite the significant level of both government and development partner financing of the human development sectors. In response, the government and the Joint Donors -- the Australian Agency for International Development (AusAid), the Asian Development Bank (ADB), and the World Bank -- embarked on a Human Development Review to suggest options for improving human development outcomes and government expenditure efficiency. In this review of strategy options for health, HIV/AIDS, and education, it is argued that human development sectors are at an important crossroad with a large unfinished agenda and a range of critical challenges.
Users also downloaded
Showing related downloaded files
Publication Africa's Future, Africa's Challenge : Early Childhood Care and Development in Sub-Saharan Africa(Washington, DC : World Bank, 2008)This book seeks to achieve a balance, describing challenges that are being faced as well as developments that are underway. It seeks a balance in terms of the voices heard, including not just voices of the North commenting on the South, but voices from the South, and in concert with the North. It seeks to provide the voices of specialists and generalists, of those from international and local organizations, from academia and the field. It seeks a diversity of views and values. Such diversity and complexity are the reality of Sub-Saharan Africa (SSA) today. The major focus of this book is on SSA from the Sahel south. Approximately 130 million children between birth and age 6 live in SSA. Every year 27 million children are born, and every year 4.7 million children under age 5 die. Rates of birth and of child deaths are consistently higher in SSA than in any other part of the world; the under-5 mortality rate of 163 per 1,000 is twice that of the rest of the developing world and 30 times that of industrialized countries (UNICEF 2006). Of the children who are born, 65 percent will experience poverty, 14 million will be orphans affected by HIV/AIDS directly and within their families and one-third will experience exclusion because of their gender or ethnicity.Publication Tanzania Diagnostic Review of Consumer Protection and Financial Literacy(World Bank, Washington, DC, 2013-11)In 2011, only 17.3 percemt of adults in Tanzania had an account at a formal financial institution and 56 percemt did not have any access to financial services. Most of the population lives in rural areas with very low incomes and poor infrastructure, and women are especially disadvantaged. Such limited access to formal financial services also inhibits financial literacy – awareness of benefits and risks, and how to take advantage of opportunities. Despite significant challenges, all institutional elements of the formal financial sector in Tanzania are in place, helping its gradual expansion, and in some segments technology is driving rapid growth – particularly in mobile and electronic payments. Still, gaps and weaknesses in financial consumer protection and financial education remain some of the main obstacles to sustainability and greater trust in the financial sector. This Diagnostic Review was requested by the Ministry of Finance of Tanzania in November 2012. It provides a detailed assessment of Tanzania’s institutional, legal and regulatory framework against the World Bank’s Good Practices for Financial Consumer Protection. Three segments of the financial sector have been analyzed: banking, microfinance, and pensions. Insurance and securities segments will be considered at a later stage. Volume I of the Review summarizes the key findings and recommendations and Volume II presents a detailed assessment of each financial segment compared to the Good Practices.Publication Tanzania(World Bank, Washington, DC, 2015-06)This study aims to achieve a better understanding of the agricultural risk and risk management situation in Tanzania with a view to identifying key solutions to reduce current gross domestic product (GDP) growth volatility. For the purpose of this assessment, risk is defined as the probability that an uncertain event will occur that can potentially produce losses to participants along the supply chain. Persistence of unmanaged risks in agriculture is a cause of great economic losses for farmers and other actors along the supply chains (for example, traders, processors, and exporters), affecting export earnings and food security. The agricultural sector risk assessment is a straightforward methodology based on a three-phase sequential process. Phase analyzes the chronological occurrence of inter-seasonal agricultural risks with a view to identify and prioritize the risks that are the drivers of agricultural GDP volatility. This report contains the findings and recommendations of the first phase and includes the identification, analysis, and prioritization of major risks facing the agricultural sector in Tanzania, as well as recommendations regarding key solutions. Chapter one gives introduction and context. Chapter two contains an overview of the agricultural sector and its performance, as well as a discussion of key agro-climatic, weather, and policy restrictions and opportunities. Chapter three includes an assessment of major risks (that is, production, market, and enabling environment risks) facing key export and food crops. Chapter four presents an estimate of historical losses due to realized production risks and a correlation of such losses with production volatility. Chapter five provides insights into the exposure to risks by different stakeholders and their actual capacities, vulnerabilities, and potential to manage agricultural risks. Chapter six presents a risk prioritization by different supply chains and discusses the possible solutions, as well as specific recommendations for the agricultural sector development program (ASDP).Publication World Development Report 2017(Washington, DC: World Bank, 2017-01-30)Why are carefully designed, sensible policies too often not adopted or implemented? When they are, why do they often fail to generate development outcomes such as security, growth, and equity? And why do some bad policies endure? This book addresses these fundamental questions, which are at the heart of development. Policy making and policy implementation do not occur in a vacuum. Rather, they take place in complex political and social settings, in which individuals and groups with unequal power interact within changing rules as they pursue conflicting interests. The process of these interactions is what this Report calls governance, and the space in which these interactions take place, the policy arena. The capacity of actors to commit and their willingness to cooperate and coordinate to achieve socially desirable goals are what matter for effectiveness. However, who bargains, who is excluded, and what barriers block entry to the policy arena determine the selection and implementation of policies and, consequently, their impact on development outcomes. Exclusion, capture, and clientelism are manifestations of power asymmetries that lead to failures to achieve security, growth, and equity. The distribution of power in society is partly determined by history. Yet, there is room for positive change. This Report reveals that governance can mitigate, even overcome, power asymmetries to bring about more effective policy interventions that achieve sustainable improvements in security, growth, and equity. This happens by shifting the incentives of those with power, reshaping their preferences in favor of good outcomes, and taking into account the interests of previously excluded participants. These changes can come about through bargains among elites and greater citizen engagement, as well as by international actors supporting rules that strengthen coalitions for reform.Publication World Development Report 1984(New York: Oxford University Press, 1984)Long-term needs and sustained effort are underlying themes in this year's report. As with most of its predecessors, it is divided into two parts. The first looks at economic performance, past and prospective. The second part is this year devoted to population - the causes and consequences of rapid population growth, its link to development, why it has slowed down in some developing countries. The two parts mirror each other: economic policy and performance in the next decade will matter for population growth in the developing countries for several decades beyond. Population policy and change in the rest of this century will set the terms for the whole of development strategy in the next. In both cases, policy changes will not yield immediate benefits, but delay will reduce the room for maneuver that policy makers will have in years to come.