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Papua New Guinea's economy is set to weaken

Monday, June 17, 2019

Subject

The economic outlook for Papua New Guinea.

Significance

The outlook for the leading commodity exports from Papua New Guinea (PNG) -- natural gas, oil and gold -- remains positive, but by most counts the economy is deteriorating and will worsen as Asia’s aggregate demand for resource commodities falls.

Impacts

  • The new government may pass legislation to obtain higher returns to PNG from foreign investment.
  • Perceived corruption and declining governance will directly damage investor confidence.
  • As financial and economic pressures mount, there may well be changes in macroeconomic policy.
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