Economy
Papua New Guinea is richly endowed with natural resources, but access has been hampered by rugged terrain, the high cost of developing infrastructure, serious law and order problems, and the system of land title which makes identifying the owners of land for the purpose of negotiating appropriate agreements problematic. Agriculture provides a livelihood for 85% of the population. Mineral deposits, including oil, copper, and gold, account for 72% of export earnings. The country also has a notable coffee industry and other crops include cocoa, oil palm and tea.
Former Prime Minister Sir Mekere Morauta tried to restore integrity to state institutions, stabilize the kina, restore stability to the national budget, privatize public enterprises where appropriate, and ensure ongoing peace on Bougainville following the 1997 agreement which ended Bougainville's secessionist unrest. The Morauta government had considerable success in attracting international support, specifically gaining the backing of the IMF and the World Bank in securing development assistance loans. Significant challenges face the current Prime Minister Sir Michael Somare, including gaining further investor confidence, continuing efforts to privatize government assets, and maintaining the support of members of Parliament.
In March 2006 the United Nations Development Programme Policy called for Papua New Guinea's designation of developing country to be downgraded to least-developed country because of protracted economic and social stagnation. However, an evaluation by the International Monetary Fund in late 2008 found that "a combination of prudent fiscal and monetary policies, and high global prices for mineral commodity exports, have underpinned Papua New Guinea's recent buoyant economic growth and macroeconomic stability. PNG's Real GDP growth rate as at 2011 was 8.9%. This economic growth has been primarily attributed to a booming mining sector, including various Liquefied Natural Gas projects. Economic 'development' based on the extractive industries also carries difficult consequences for local communities. One major project conducted through the PNG Department for Community Development suggested that other pathways to sustainable development should be considered.
Read more about this topic: Papua New Guinea
Famous quotes containing the word economy:
“Wise men read very sharply all your private history in your look and gait and behavior. The whole economy of nature is bent on expression. The tell-tale body is all tongues. Men are like Geneva watches with crystal faces which expose the whole movement.”
—Ralph Waldo Emerson (1803–1882)
“Even the poor student studies and is taught only political economy, while that economy of living which is synonymous with philosophy is not even sincerely professed in our colleges. The consequence is, that while he is reading Adam Smith, Ricardo, and Say, he runs his father in debt irretrievably.”
—Henry David Thoreau (1817–1862)
“Cities need old buildings so badly it is probably impossible for vigorous streets and districts to grow without them.... for really new ideas of any kind—no matter how ultimately profitable or otherwise successful some of them might prove to be—there is no leeway for such chancy trial, error and experimentation in the high-overhead economy of new construction. Old ideas can sometimes use new buildings. New ideas must use old buildings.”
—Jane Jacobs (b. 1916)