Papua New Guinea - Country Economic Memorandum - Pathways to Faster and More Inclusive Growth

Jul 19, 2026

Papua New Guinea’s Country Economic Memorandum outlines policy pathways aimed at faster and more inclusive growth. It presents the preparation and authorship of a multisectoral World Bank team and establishes context for the analytical findings. The document highlights why economic growth should anchor policymaking, including limited per capita gains and weak convergence, and explains how governance, institutions, and economic structure shape growth outcomes. It further focuses on macroeconomic stability and reducing volatility through fiscal sustainability and countercyclical policy.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages127

Reading Time5 h 20 min

Preface and Acknowledgments

Executive Summary

Chapter I. Introduction

1. Why should economic growth become the focus for policy makers?

2. Why and how governance and institutions matter for growth in PNG

3. Growth is not only about extractives

Chapter II. Seeking Stability

4. Excessive macroeconomic volatility and risks to macroeconomic stability

5. Explaining high volatility and challenges for macroeconomic stability

6. Reducing volatility and safeguarding macroeconomic sustainability

Pub lic Disclosure Authorized Pub lic Disclosure Authorized Pub lic Disclosure Authorized Pub lic Disclosure Authorized Papua New Guinea: Country Economic Memorandum Pathways to faster and more inclusive growth PAPUA NEW GUINEA Country Economic Mem orandum Pathways to Faster and More Inclusive Growth Preface and Acknowledgments The PNG Country Economic Memorandum (CEM) was prepared by a multisectoral World Bank team led by the Macroeconomics, Trade and Investment Global Practice, under the guidance of Stephen N. Ndegwa (Country Director), Lars Christian Moller (Practice Manager), Stefano Mocci (Country Manager -until October 2022), Jane Sprouster (Acting Country Manager-until March 2023), and Khwima Lawrence Nthara. The core team comprises Ruslan Piontkivsky (Task Team Leader), Ruth Nikijuluw (Task Team Leader), Virginia Horscroft, Christopher Miller, Lars Sondergaard, and Giorgia Demarchi, with contributions from Rubayat Chowdhury, Rashad Hasanov, Samuel Wills, John Grinyer, David Craig, Ildrim Valley, Juliana Weingaertner, Blair Lapres, Rochelle Eng, Son Thanh Vo, Allan Oliver, Emily Schmidt, Miok Kasek Komolong, Sharon Inone, Matthew Dornan, Ning Fu, Mits Motohashi, Katsuyuki Fukui, Gerard Fae, Pedro Antmann, Ximing Peng, Wilfred Lus, Robert Van der Gest, Trang Thu Tran, Alina Antoci, William Gain, Katia D’Hulster, Xavier Vincent, Nina Doetinchem, Francis Sinclair Chopin, Dimitria Gavalyugova, Uzma Quresh, Alice Calder, Tessa Walsh, Kari Hurt, Changqing Sun, Darian Naidoo, Sharad Alan Tandon, Undral Batmunkh, Da Woon Chung, and Aneesa Arur. Michelle Lee and Rachel Leka provided administrative support. Susi Victor edited the text. Dissemination is organized by Tom Perry and Ruth Moiam. The team is grateful to the Department of Treasury and other government departments for their collaboration in the development of this report. The team would like to express appreciation for feedback from David Gould, Samer Matta, Dhruv Sharma, Fiseha Haile, and Ruchira Kumar. This report is a product of the staff of the International Bank for Reconstruction and Development/The World Bank. The findings, interpretations, and conclusions expressed in this report do not necessarily reflect the views of the Executive Directors of the World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of the World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. Cover design is by Greenhouse Studios. Cover photograph by Tom Perry. All rights reserved. To be included on an email distribution list for the CEM and related publications, please contact Ruth Moiam: [rmoiam@worldbank.org](rmoiam@worldbank.org). For questions and comments relating to this publication, please contact Ruslan Piontkivsky: [rpiontkivsky@worldbank.org](rpiontkivsky@worldbank.org). For information about the World Bank and its activities in Papua New Guinea, please visit [www.worldbank.org/png](www.worldbank.org/png). Table of Contents PREFACE AND ACKNOWLEDGMENTS .......................................................................... II EXECUTIVE SUMMARY........................................................................................................3 CHAPTER I. INTRODUCTION ............................................................................................9 1. Why should economic growth become the focus for policy makers? ......................................10 1.1. Modest headline growth masks low per capita growth ....................................................................................................... 10 1.2. Per capita income is not converging .........................................................................................................................

FAQs

Why does the memorandum emphasize shifting policy focus toward economic growth in Papua New Guinea?

It argues that headline growth does not translate into meaningful per capita gains, and per capita income is not converging. The report frames economic growth as the key agenda for policymakers to address these gaps.

How do governance and institutions influence growth in PNG according to this report?

The document highlights that governance and institutions matter for growth outcomes. It includes this as a distinct factor in explaining how PNG’s growth performance can be improved.

What are the report’s main priorities for improving macroeconomic stability?

It focuses on understanding excessive volatility and its risks, including debt distress. It then discusses reducing volatility by strengthening fiscal sustainability and adopting countercyclical macroeconomic policies.

Jul 19, 2026

Upload by Ava Thompson