Economist predicts weak growth

The National Business

By DALE LUMA
THERE will be weak growth of the economy next year, according to an economist.
At a recent business event in Port Moresby, Westpac senior economist Justin Smirk said: “We expect that there will be weak economic growth in 2021 following the after-shock and recovery of the Covid-19 on businesses and the economy with mining output also expected to be low.
“The medium term recovery will be driven by non-resource sectors such as agriculture, fisheries and forestry, dependent on the return to production of Porgera mine.”
Prime Minister James Marape, however, recently said a budget analysis done by an accounting firm has shown that economic growth was forecast to rebound at 3.5 per cent next year.
This will be driven by a recovery across most sectors and improved global demand and consumption off the back of the Covid-19.
“This will see growth rise to an estimated 10.6 per cent in nominal terms (which is an increase from an initial 7.4 per cent forecast in the 2021 Budget strategy paper) totalling K90.3 billion and is expected to increase in 2022 to reach an estimated growth at K99.4 billion,” Marape said.
“The forecast increase of 10 per cent per annum in both 2021 and 2022 is the highest in PNG’s history, and is larger than the growth from 2013 to 2015 when the PNG LNG project commenced production.
“Economic growth is projected to grow at a steady annual growth rate of 3.1 per cent over the medium term, in line with an estimated 3.7 per cent growth in the non-mining sector.”
Marape said this was an unprecedented forecast for PNG and that the numbers represented a vote of confidence in his Government’s policies and programmes.

4 comments

  • If pingyang and wafi are initiated, and pogera commences production, we can expect some level of increase in economic performances.
    On a long term approach, citizens should be encouraged to freeup customary land for development in agriculture and farming and the government in its 2050 plan needs to strongly support this industry. JMPM might not be around as PM to do that but we can take png back, and this is one of the best available means to do that.

  • Obviously, the wisdom of common sense tells the economic recovery national and globally is snail pace and may continue to 2021 and 2022. The financial outlook growth as reported is merely exaggerated with lavish unrealistic outlook when no new presence of foreign investment and other major players/organizations are stalled, who are the main support of cash injecting to the government coffers. You don’t expect supply and demand to just light up from the aftermath of covid-19. This endemic economic killer strangled all economies off-guard. It traumatized supply and demand value chain. The growth prediction is unreal when the economic environment is contrary.

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