PNG economy expected to grow by 3.7pc

PAPUA New Guinea’s economy is set to grow by 3.7 per cent this year from 0.2 per cent last year, according to an Asian Development Bank outlook report.
It attributes this to a full year of production of key mineral, petroleum and gas exports, plus improved access to foreign exchange.
The bank’s country director, David Hill, said the medium-term outlook for PNG’s economy remained positive.
“Ongoing structural reform and market-focused policies are critical for attracting foreign capital and helping build an economy that is more diversified and shock resilient,” Hill said.
It notes that shortages of foreign currency had been a key constraint on the private sector in recent years, with importers having to queue to receive foreign currency, sometimes for several weeks.
During 2018, however, there was an improvement in the availability of foreign exchange, with the backlog in foreign currency orders falling by 48 per cent.
This trend is expected to continue in 2019 as foreign exchange reserves are released at a steady pace to the market.
The Papua Liquefied Natural Gas (LNG) project and the PNG LNG expansion project are expected to attract foreign investment in excess of US$10 billion, with construction expected to start next year.
The forecast period should also see construction start on the US$2.8 billion (K9.4bil) Wafi–Golpu gold and copper mine project.
A telecommunications fibre optic cable connecting Port Moresby with Sydney is expected to be completed at the end of the year.
It will significantly increase internet speed while reducing costs. Inflation is projected to ease to
4.2 per cent this year before rising to 4.7 per cent in 2020 because of new project demands.