Papua New Guinea Economy - 2004

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 faltered over the past four years. 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. The government has had considerable success in attracting international support, specifically gaining the backing of the IMF and the World Bank in securing development assistance loans. Challenges face Prime Minister Michael SOMARE, including curbing inflation, 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 - $11.4 billion (2003 est.)

GDP - real growth rate:
0.7% (2003 est.)

GDP - per capita:
purchasing power parity - $2,200 (2003 est.)

GDP - composition by sector:
agriculture: 32.1%
industry: 35.8%
services: 32.1% (2001 est.)

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):
17.2% (2003 est.)

Labor force:
2.3 million (1999)

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

Unemployment rate:
NA%

Budget:
revenues: $894 million
expenditures: $1.1 billion, including capital expenditures of $344 million (2000 est.)

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 (FY01/02 est.)

Electricity - production:
1.496 billion kWh (2001)

Electricity - production by source:
fossil fuel: 54.1%
hydro: 45.9%
other: 0% (2001)
nuclear: 0%

Electricity - consumption:
1.391 billion kWh (2001)

Electricity - exports:
0 kWh (2001)

Electricity - imports:
0 kWh (2001)

Oil - production:
67,500 bbl/day (2001 est.)

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

Oil - exports:
NA

Oil - imports:
NA

Oil - proved reserves:
345.2 million bbl (1 January 2002)

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 (1 January 2002)

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

Exports:
$1.938 billion f.o.b. (2003 est.)

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

Exports - partners:
Australia 24.2%, Japan 9.4%, China 5.4% (2002)

Imports:
$967 million f.o.b. (2003 est.)

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

Imports - partners:
Australia 49.2%, Singapore 18.8%, New Zealand 4.4%, Japan 4.3% (2002)

Debt - external:
$2.7 billion (2003 est.)

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

Currency:
kina (PGK)

Currency code:
PGK

Exchange rates:
kina per US dollar - 3.56 (2003), 3.9 (2002), 3.39 (2001), 2.78 (2000), 2.57 (1999)