Economy good: WB

WORLD Bank (WB) has delivered another positive outlook for PNG, highlighting the nation’s economic performance throughout the past two years and projecting a strong picture for its future prospects.The details and other information were delivered in the bank’s latest edition of its East Asia and Pacific Update, a six-monthly report into the region’s economic and social health.Despite operating against the external pressures resulting from the worst global recession in more than half a century, WB noted that PNG had recorded sound economic growth of 4.5% last year, compared to 6.7% in 2008.The WB reported that this strong performance was attributed in part to prudent fiscal policies and Government stimulus spending using payments from mineral resources saved over the commodity boom years.In moving forward, the bank has forecast strong opportunities for continued growth in future years particularly as developments of the groundbreaking liquefied natural gas (LNG) project continues to move ahead successfully.The historic project has the capacity to generate thousands of employment opportunities, inject billions of kina back into the local economy and stimulate significant follow on economic growth and development across PNG, and the wider Pacific region, throughout its 30-year lifespan.“Estimates suggest that the project will yield a 50 million barrels oil equivalent of natural gas and lead to US$3 billion (K8.2 billion) in average annual export receipts starting in 2013-14.By one consortium partner’s estimates, the project could turn PNG into the second largest LNG producer in Southeast Asia, after Malaysia and past Indonesia, by 2017.“Growth is projected to rebound strongly this year, as the construction of the LNG facility begins and the project directly and indirectly stimulates domestic demand.“Real GDP growth could increase by 0.8 percentage points a year during the construction phase alone and then perhaps by 15-25% per year during the 30-year life of the pro ject, doubling the country’s GDP in three to five years after the project becomes operational,” the Bank said.The LNG project and a number of other initiatives continue to instil renewed confidence amongst investors and consumers.