10 Apr 2008

Resources boom in PNG could become a curse: AusAID warns

10:31 am on 10 April 2008

The new chief economist of the Australian government's overseas aid programme or AUSAID has offered a positive assessment of Papua New Guinea's economy but warns its resources boom could become a curse.

Dr Mark McGillivray presented the Pacific Economic Survey in the PNG capital, Port Moresby yesterday.

The report shows PNG's mineral revenue has increased seven fold since 2002, and last year earned the country about US$700 million.

PNG's 2007 GDP growth of 6-point-2 percent could make an impact on poverty and improve human development, but must be properly managed.

He says PNG is in a much better position than other developing countries that have faced this resources boom in the past, but the question is if it can be managed appropriately.

Australia currently gives US$329 million a year through AusAID, and more than $US370 million has been earmarked for next year.