PNG to lead growth in Pacific: Escap
By SHEILA LASIBORI in Fiji
PAPUA New Guinea is expected to continue to grow its economy this year ahead of other Pacific Island countries, according to a recent Escap survey.
The Economic and Social Commission for Asia and the Pacific (ESCAP) recent “Economic and Social Survey of Asia and the Pacific 2008” said continued increases in world mineral and oil prices will trigger PNG’s continued growth in the gross domestic product (GDP) by 6.6%, a 0.4% increase from last year’s rate of 6.2%.
David Smith, the regional advisor from Escap’s Pacific Operations Centre in Fiji said despite the expected growth for PNG the constraints to business included weak governance; poor law and order; poor infrastructure; and unreliable utilities, among others.
“Papua New Guinea is among the few countries enjoying a trade surplus because of its mineral and petroleum exports,” Mr Smith said in light of increasing trade deficits being experienced in other Pacific countries.
Palau, a country among the smaller Island countries follows PNG with a 4.8% expected growth rate (5.5% in 2007); Solomon Islands standing on its increasing log exports and increasing aid is expected to grow at 4.2% (5.4% in 2007); Vanuatu, increasing tourism to cause growth at 4.6% (4.7); Samoa 3.5% (3); smaller Pacific Islands (combined) based on tourism and fishing licence fees will see growth at 4.8% (2.7%); Cook Islands, 3.5% (2.5%); Tuvalu, 2.5% (2.5%); Kiribati, 1% (1%); Tonga, .8% (-5.5%); and Fiji, 2.2% (-3.9).
The survey stated that Fiji’s economic growth was the lowest in all Pacific Island countries in 2007.
“The coup in Fiji in December 2006 created uncertainty, leading to declining tourist arrivals, worker layoffs, a fall in the wholesale and retail trades and a freeze on private-sector investment projects,” the survey reported.
“Although economic growth in the Pacific island region is largely expected to see continued growth this year, political uncertainties and the impact of rising numbers of people seeking employment needs to be addressed to achieve sustainable economic development,” it said.
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