PNG’s growth to remain low, says report

By Lemach Lavari, The National PNG

Growth of the Papua New Guinea economy is expected to remain low this year and in 2019, according to a bank economic report.

The Australia and New Zealand (ANZ) Banking Group report said PNG’s gross domestic product would grow by 1.9 per cent this year and 2.1 per cent in 2019.

This is well below the 8 per cent PNG achieved during the PNG LNG construction phase.

According to the report, lack of growth was due to the shortage of foreign exchange and the diminishing benefits of LNG.

The report was released last month.

It is a quarterly outlook on the PNG economy.

ANZ international economist Dr Kishti Sen told The National that the waiting period to access foreign currency by companies which imported had recently decreased slightly, but they were still in desperate need of foreign currency.

“Importers are therefore losing confidence and are not investing for growth,” he said.

“This has contributed to a slowing of the economy. If importers can secure foreign currency more freely, then it will build confidence.
“Also, businesses looking to send profits back to their home country are in the queue for foreign exchange.

“A quicker clearance of the backlog of orders (to sell Kina) is paramount for restoring business confidence in the economy.”

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