Papua New Guinea Economy - 2005

Economy - overview:
Papua New Guinea is richly endowed with natural resources, but exploitation has been hampered by rugged terrain and the high cost of developing infrastructure. Agriculture provides a subsistence livelihood for 85% of the population. Mineral deposits, including oil, copper, and gold, account for 72% of export earnings. The economy has improved over the past two years, following a prolonged period of instability. Former Prime Minister Mekere MORAUTA had tried to restore integrity to state institutions, to stabilize the kina, restore stability to the national budget, to privatize public enterprises where appropriate, and to ensure ongoing peace on Bougainville. Australia annually supplies $240 million in aid, which accounts for 20% of the national budget. Challenges face Prime Minister Michael SOMARE, including gaining further investor confidence, continuing efforts to privatize government assets, maintaining the support of members of Parliament, and balancing relations with Australia, the former colonial ruler.

GDP:
purchasing power parity - $11.99 billion (2004 est.)

GDP - real growth rate:
0.9% (2004 est.)

GDP - per capita:
purchasing power parity - $2,200 (2004 est.)

GDP - composition by sector:
agriculture: 34.5%
industry: 34.7%
services: 30.8% (2004 est.)

Labor force:
3.32 million (2004 est.)

Labor force - by occupation:
agriculture 85%, industry NA, services NA

Unemployment rate:
NA

Population below poverty line:
37% (2002 est.)

Household income or consumption by percentage share:
lowest 10%: 1.7%
highest 10%: 40.5% (1996)

Distribution of family income - Gini index:
50.9 (1996)

Inflation rate (consumer prices):
4.2% (2004 est.)

Investment (gross fixed):
13.6% of GDP (2004 est.)

Budget:
revenues: $1.174 billion
expenditures: $1.232 billion, including capital expenditures of $344 million (2004 est.)

Public debt:
59.3% of GDP (2004 est.)

Agriculture - products:
coffee, cocoa, coconuts, palm kernels, tea, rubber, sweet potatoes, fruit, vegetables, poultry, pork

Industries:
copra crushing, palm oil processing, plywood production, wood chip production; mining of gold, silver, and copper; crude oil production; construction, tourism

Industrial production growth rate:
NA

Electricity - production:
1.679 billion kWh (2002)

Electricity - consumption:
1.561 billion kWh (2002)

Electricity - exports:
0 kWh (2002)

Electricity - imports:
0 kWh (2002)

Oil - production:
46,200 bbl/day (2004 est.)

Oil - consumption:
15,000 bbl/day (2001 est.)

Oil - exports:
NA

Oil - imports:
NA

Oil - proved reserves:
170 million bbl (2004 est.)

Natural gas - production:
110 million cu m (2001 est.)

Natural gas - consumption:
110 million cu m (2001 est.)

Natural gas - exports:
0 cu m (2001 est.)

Natural gas - imports:
0 cu m (2001 est.)

Natural gas - proved reserves:
385.5 billion cu m (2004)

Current account balance:
$29.15 million (2004 est.)

Exports:
$2.437 billion f.o.b. (2004 est.)

Exports - commodities:
oil, gold, copper ore, logs, palm oil, coffee, cocoa, crayfish, prawns

Exports - partners:
Australia 27.7%, China 5.8%, Japan 5.7%, Germany 5% (2004)

Imports:
$1.353 billion f.o.b. (2004 est.)

Imports - commodities:
machinery and transport equipment, manufactured goods, food, fuels, chemicals

Imports - partners:
Australia 45.2%, Singapore 21.1%, New Zealand 7.5%, Japan 4.2%, China 4.2% (2004)

Reserves of foreign exchange and gold:
$635.8 million (2004 est.)

Debt - external:
$2.463 billion (2004 est.)

Economic aid - recipient:
$400 million (1999 est.)

Currency (code):
kina (PGK)

Exchange rates:
kina per US dollar - 3.2225 (2004), 3.5635 (2003), 3.8952 (2002), 3.3887 (2001), 2.7822 (2000)