Papua New Guinea, the Pacific sub-region’s largest economy, faces tough challenges in pursuing effective economic management while maintaining public spending for the delivery of basic social services, says a new Asian Development Bank report launched today in Port Moresby.
ADB’s Pacific Department biannual economic report; the Pacific Economic Monitor says:
• Economic growth in PNG will reach 4.3% in 2016, slowing to 2.4% in 2017.
• Non mining sector expected to grow around 3.8% in 2016, slowing to 3.2% in 2017.
• Inflation is expected to stabilize around 6% in 2016 and may increase in 2017.
Country Economist, ADB PNG Resident Mission – Yurendra Basnett stated that; to address the fiscal challenges that the government has been facing, they need to close the gap between allocation and expenditure through planning and execution so that resources don’t become idle and incur costs.
Economist for ADB’s Pacific Department, Christopher Edmonds, stated that with the latest occurrences of natural disasters i.e. cyclone Winston in Fiji, the region must now take a serious look at Natural disasters being factored as economic impediments. He went on to draw comparison between PNG and Timor’s “resource curse” issues, with Timor coming out on top as they had set up a petroleum fund that is now cushioning the blow of oil prices.
Whilst taking a regional view on the fisheries sector and how it can boost the entire region.