Ratings show PNG economy will strengthen

THE global ratings agency Standard & Poors has given Papua New Guinea a “B/B rating with a stable outlook” in its latest assessment.
PNG’s economy has been under strain for several years but it said it expected fiscal performance to improve up to 2022. The agency puts this down to “favourable resource tax collection and a tightening of expenditure”. As such, the agency said it was affirming its ‘B’ foreign and local currency long-term ratings and ‘B’ respective short-term rating on PNG.
It said the stable outlook reflected its view that PNG would remain a “low-income economy with weak institutions and limited monetary flexibility”. “We expect economic growth to be relatively subdued until 2021, then to increase sharply to 5 percent in 2022 and beyond due to the construction of the Papua liquefied natural gas (LNG) project.”