Papua New Guinea’s Economy Grows, but Jobs Gap Remains

New Papua New Guinea Economic Update calls for stronger investment in people, infrastructure, the business environment, and private sector growth. Port Moresby, July 2, 2026 — Papua New Guinea’s economy is growing strongly but is not yet creating enough quality jobs for its fast-growing population, according to a new World Bank Economic Update launched today. The latest Papua New Guinea Economic Update: Turning Growth into Jobs finds PNG’s economy expanded by 5.6 percent in 2025, one of the strongest performances in the Pacific. This was supported by strong gold and LNG production, alongside exchange rate reforms, which improved the business environment beyond the resource sector. However, the report finds that formal employment per capita has declined, with most new workers entering subsistence farming and informal work rather than secure, formal jobs. The World Bank suggests this growth-jobs disconnect is one of PNG’s central development challenges. “Papua New Guinea is at a critical moment. The economy is growing and the resource sector has major opportunities ahead. There is now a small window of opportunity to turn this momentum into better jobs and livelihoods for all Papua New Guineans,” said Han Fraeters, World Bank Division Director for Papua New Guinea, Solomon Islands, and Vanuatu. “All evidence points in the same direction: PNG can make its resource wealth work better for its people. That means securing fairer returns, investing more in human capital and infrastructure, and improving the conditions for private sector growth.” The Economic Update sets out a three-part jobs agenda: (i) strengthening foundations for growth through improved infrastructure and human capital; (ii) enhancing the business environment and economic governance so firms can invest and hire; and (iii) mobilizing more private capital while ensuring resource revenues are used more effectively to support sectors that can create jobs at scale. The report identifies agribusiness as one of PNG’s most promising pathways for creating jobs at scale. Strengthening key agricultural value chains could generate around 330,000 additional formal jobs over the next decade and reduce poverty by around five percentage points, lifting an estimated half a million Papua New Guineans out of poverty. However, the report highlights inadequate infrastructure and weak human capital as key constraints to productivity growth and job creation. Better roads, electricity, and digital connectivity are also needed to support investment beyond Port Moresby and Lae, while stronger investment in nutrition, education, and skills will be critical to prepare PNG’s young population for more productive work. Business constraints also remain significant. Crime, insecurity, regulatory uncertainty, and limited access to finance continue to increase the cost and risk of doing business. The report highlights the potential of upcoming resource projects, including Papua LNG and Wafi-Golpu, as a major opportunity to support long-term growth and job creation. However, realizing these benefits will require agreements that ensure better capture and management of resource revenues to support national development priorities. Download the Report Visit our website: worldbank.org/pngFollow us on Facebook: facebook.com/worldbankpacificSubscribe to our newsletter: Click here