Papua New Guinea Economy 2007

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 nearly two-thirds of export earnings. The government of Prime Minister SOMARE has expended much of its energy remaining in power and should be the first government in decades to serve a full five-year term. The government also brought stability to the national budget, largely through expenditure control; however, it has relaxed spending constraints in 2006 and 2007 as elections approach. Numerous challenges still face the government including regaining investor confidence, restoring integrity to state institutions, promoting economic efficiency by privatizing moribund state institutions, and balancing relations with Australia, its former colonial ruler. Other socio-cultural challenges could upend the economy including a worsening HIV/Aids epidemic and chronic law and order and land tenure issues. Australia annually supplies $240 million in aid, which accounts for nearly 20% of the national budget.

GDP (purchasing power parity):
$15.41 billion (2006 est.)

GDP (official exchange rate):
$4.167 billion (2006 est.)

GDP - real growth rate:
3.7% (2006 est.)

GDP - per capita (PPP):
$2,700 (2006 est.)

GDP - composition by sector:
agriculture: 36.1%
industry: 36.7%
services: 27.2% (2006 est.)

Labor force:
3.477 million (2006 est.)

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

Unemployment rate:
2% up to 80% in urban areas (2004)

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):
2.9% (2006 est.)

Investment (gross fixed):
19.4% of GDP (2006 est.)

Budget:
revenues: $2.065 billion
expenditures: $1.924 billion (2006 est.)

Public debt:
47% of GDP (2006 est.)

Agriculture - products:
coffee, cocoa, copra, palm kernels, tea, sugar, rubber, sweet potatoes, fruit, vegetables, vanilla; shell fish, poultry, pork

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

Industrial production growth rate:
NA%

Electricity - production:
3.698 billion kWh (2005)

Electricity - consumption:
3.439 billion kWh (2005)

Electricity - exports:
0 kWh (2005)

Electricity - imports:
0 kWh (2005)

Oil - production:
50,000 bbl/day (January 2006 est.)

Oil - consumption:
18,000 bbl/day (January 2006 est.)

Oil - exports:
NA bbl/day

Oil - imports:
NA bbl/day

Oil - proved reserves:
170 million bbl (1 January 2006)

Natural gas - production:
95.91 million cu m (2005 est.)

Natural gas - consumption:
95.91 million cu m (2005 est.)

Natural gas - exports:
0 cu m (2005 est.)

Natural gas - imports:
0 cu m (2005)

Natural gas - proved reserves:
331.3 billion cu m (1 January 2006 est.)

Current account balance:
$472.6 million (2006 est.)

Exports:
$4.128 billion f.o.b. (2006 est.)

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

Exports - partners:
Australia 30.2%, Japan 8.2%, China 5.7% (2006)

Imports:
$1.958 billion f.o.b. (2006 est.)

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

Imports - partners:
Australia 52%, Singapore 12.6%, China 5.9%, Japan 4.3% (2006)

Economic aid - recipient:
$NA (2005)

Reserves of foreign exchange and gold:
$1.427 billion (2006 est.)

Debt - external:
$1.813 billion (2006 est.)

Stock of direct foreign investment - at home:
$NA

Stock of direct foreign investment - abroad:
$NA

Market value of publicly traded shares:
$4.863 billion (2005)

Currency (code):
kina (PGK)

Exchange rates:
kina per US dollar - 3.0643 (2006), 3.08 (2005), 3.2225 (2004), 3.5635 (2003), 3.8952 (2002)