ÐÓ°ÉÂÛ̳

Papua New Guinea (PNG) is the world¡¯s most linguistically diverse country, with over 850 indigenous languages. It comprises the eastern part of the island of New Guinea; the islands of New Britain, New Ireland, and the Autonomous Region of Bougainville; and 600 smaller islands and atolls. Its rich geographic and natural resources include large reserves of valuable minerals, vast forests, abundant water and marine resources, and fertile land for agriculture.

PNG¡¯s population of about 11.8 million people is young and growing. The country¡¯s rich culture is complex and deeply rooted in tribal and ethnic identity and relationships to the land, which contribute to the country¡¯s unique challenges as well as its considerable resilience.

Two broad sectors dominate the economy. Agricultural, forestry, and fishing employ most of the labor force (the majority employed informally). Minerals and energy extraction account for most export earnings and GDP.

Despite a challenging external environment, the economic outlook remains broadly positive, driven by strong performance in agriculture, a key contributor to economic recovery and long-term prosperity.

PNG¡¯s modest headline economic growth has translated into limited per capita income growth over the past 40 years. Macroeconomic volatility, low productivity growth, heavy reliance on natural resources, and missed opportunities to take full advantage of its human capital have constrained growth, according to the . To achieve stronger and more inclusive economic growth, the country needs to increase economic stability; boost productivity; nurture human capital, including by improving  gender equality; and enhance physical infrastructure, including electricity, telecommunications, and road and other transport infrastructure that is critical to private sector¨Cled growth.

Last updated: May 2025

ÐÓ°ÉÂÛ̳ continues to support the government¡¯s efforts to strengthen macroeconomic management and improve service delivery, to ensure that development benefits reach all the people of PNG, particularly 85 percent of the population living in rural areas. Its approach is guided by the Country Partnership Framework for Papua New Guinea, which is closely aligned with PNG¡¯s development plans. That framework lays out three focus areas:

• Improving macroeconomic and fiscal resilience;
• Providing more effective and inclusive services, particularly in remote and underserved areas;
• Diversifying the economy and creating jobs, including outside the natural resources¨Cbased sector.

The strategy is underpinned by the aims of strengthening governance in the natural resources sector and in the management of public resources. It aims to ensure that everyone, regardless of gender, location, and/or social and economic circumstances, can benefit equally from the ÐÓ°ÉÂÛ̳¡¯s work to support PNG¡¯s development goals.

Download , the guide to the ÐÓ°ÉÂÛ̳¡¯s work across the Pacific. It includes a map of the Bank¡¯s work across the Pacific and program break-downs by country. (888 kb PDF file)

The Australian and New Zealand governments support the ÐÓ°ÉÂÛ̳¡¯s work in the Pacific and PNG, through the PNG and the Pacific Islands Umbrella Facility (PPIUF).

Key Areas of Financial Support

Working in partnership with the government, the ÐÓ°ÉÂÛ̳ is currently supporting 11 active projects across infrastructure, income and jobs, and social sectors in PNG, with commitments totaling US$663 million.

(i) Infrastructure

In infrastructure, the WB is supporting the transport, energy, and water sectors. Within the transport sector, the US$108 million  is funding the rehabilitation of key sections of the Ramu highway and the extended maintenance of nearly 200 kilometers (km) of critical transport links.

In the energy sector, the US$30 million  (EUPRIP) is supporting the rehabilitation, reinforcement, and upgrade of infrastructure on the Port Moresby, Ramu, and Gazelle grids owned and operated by PNG Power Limited. The newly approved US$204 million National Energy Access Transformation (NEAT) project will scale up the Bank¡¯s support in the sector by connecting more households and businesses to electricity, particularly in the rural areas, expanding renewable energy generation, and supporting the modernization of the country¡¯s electricity infrastructure.

The WB is also supporting the upgrading of water supply infrastructure in provincial and district towns through the US$70 million Water Supply and Sanitation Development Project. Finally, the Rural Service Delivery Project (RSDP), is providing US$23 million in support for community driven development infrastructure projects.

(ii) Income and Jobs

The US$40 million  builds on the success of the US$75 million , which supported efforts to build the skills, productivity, and access to markets of more than 67,000 coffee and cocoa farmers. The new project continues to support coffee and cocoa growers as well as farmers of small livestock and crops such as coconut and spices.

The US$32 million  project is helping ensure equitable access to rapidly expanding employment opportunities in Australia and New Zealand, with a focus on women and disadvantaged groups, and preparing workers for deployment to Australia and New Zealand and reintegration on return to PNG.

The US$ 35 million Urban Youth Employment Project prepares the youth in urban areas for the job market by providing them with temporary employment opportunities through the urban works program, and internship and Technical and Vocational Education and Training (TVET) programs.

(iii) Social Sectors

Within the Social Sectors, support so far has been concentrated in the health sector. The US$90 million  provides child grants to pregnant and lactating mothers to be used for purchasing food and nutrition supplements in order to reduce child malnutrition. It also supports the implementation of the PNG CARES (Community-based Approach to Reduce and End Stunting) initiative, delivering improvements to nutrition-focused health services at provincial health centers throughout the country. The US$ 30 million Improving Access to & Value from Health Services (IMPACT) Project seeks to improve the quality of primary health care by improving governance systems and upgrading health facilities so that they meet minimum service standards.

Support through Analytical Services and Advisory

The Bank also provides analytical services and advisory in order to inform policy and investment decisions. For example,  the Bank prepares annual Economic Updates and in 2023 it published its flagship comprehensive report on PNG¡¯s economic challenges and prospects, the Country Economic Memorandum.

Last updated: May 2025

Poor road conditions in PNG make travel by road impossible, unsafe, or too expensive for many people. Without reliable access to transport infrastructure and roads, people cannot reach schools, hospitals, or markets when they need to. Under the recently closed , PNG restored more than 236 km of critical road links across the country and rehabilitated, maintained, and/or replaced more than 50 national and provincial bridges, benefitting an estimated 1.3 million people (27 percent of the population).

High rates of drug-resistant tuberculosis (TB) pose a significant health threat in several provinces of PNG. TB is a leading cause of death in PNG, the country with the highest proportion of children affected by the disease. A successful community-based TB treatment program funded by the ÐÓ°ÉÂÛ̳ but which is now closed  supported efforts by communities across the National Capital District (Port Moresby) to help eradicate this deadly disease. The program was first piloted in Western Province on Daru Island, where the ÐÓ°ÉÂÛ̳ contributed US$15 million to the  to improve screening, diagnosis, and treatment programs. Patient treatment drop-out rates have fallen from 30 percent to zero on Daru Island, once one of the world¡¯s most significant hotspots for multidrug-resistant TB.

Through the , rural towns across PNG are now being connected to clean, reliable running water supplies. Over 5,000 residents of the West New Britain town of Bialla now have water connections, as do the town¡¯s health center, school, and local market, delivering significant knock-on impacts for health and education.

In the capital, Port Moresby, the US$35 million Urban Youth Employment Project II is helping improve the capacity of young men and women to engage in productive income-generating activities. Its predecessor, the Urban Youth Employment Project (UYEP), provided 18,500 unemployed people (40 percent of them women) with vocational training and fully subsidized work placements, creating over 815,000 days of work. UYEP II extends the program into Lae, PNG¡¯s industrial hub and second-largest city.

The Productive Partnerships in Agriculture Project (PPAP), which was completed in 2022, supported more than 67,000 smallholder cocoa and coffee producers. Income and yields increased by an average 40 percent across 12 provinces. The project also helped 24,000 women earn income, save money, and strengthen their roles in coffee- and cocoa-growing industries. ÐÓ°ÉÂÛ̳ is now supporting government efforts to build on the successes of PPAP and to support the production of other crops, including coconut and spices, as well as small livestock, under the five-year, US$40 million .

Last updated: May 2025