Slow growth rate may affect Pacific countries

 THE slowdown in Papua New Guinea’s growth rate will have effects on other Pacific countries as well, an economist says. 

South Asia, ASEAN and Pacific chief economist Glenn Maguire said this would happen since PNG was the strongest economy in the region.

“PNG dominates Pacific trade in the same way it dominates GDP (gross domestic product),” Maguire said.  

“PNG accounts for almost 80 per cent of Pacific exports by volume, and about 60 per cent of imports by volume. 

“A slower PNG economy will have knock on effects to Pacific Trade,” he said. Maguire said for the Pacific currencies, it was interesting that the hard commodity exporters of the Pacific have had the least downward movement in their currencies during this period of drop in commodity prices.  

He said Pacific trade growth has surged over the past decade on both exports and imports. “Trade growths are higher,” he said. 

“Mid-teens from 2002-2014 verses low single digits over 1981-2001.

“This is evident that the region is stepping up its integration with the global economy. 

“By comparison China is roughly one-half of Asia GDP and trade.”