Summary

Research Report: Significant social and economic inequity remains in PNG. The differences in living standards between rural and urban areas are dramatic.

Description

Author: Michael Baxter, Senior Policy and Program Adviser, World Bank
(on secondment to AusAID)

Significant social and economic inequity remains in PNG and just over a
third of the population are living below the poverty line. The differences in
living standards between rural and urban areas are dramatic. The rural
poverty rate is almost three times that of urban areas, with 94 per cent of the
poor living in rural areas. Rural areas suffer from limited economic activity
and opportunity, poor access to services, remoteness from urban markets,
high-cost and deteriorating transport infrastructure, low and declining levels
of public and private investment, a range of law and order and governance
problems, and environmental pressures. They also face accelerating population
pressure.

• A strategy for rural sector growth could be built on principles that:
• adopt a clear, limited role for government to address equity and efficiency
  in the rural sector and to support - not duplicate - the role of the private
  sector;
• encourage the informal sector throughout rural and urban areas;
• give priority to establishing growth in real gross domestic product in the
  rural sector, but do not ignore the need to also provide critical services and
  social investment, such as education and health care;
• address poverty directly and tackle gender constraints to development;
• approach financing imaginatively and openly, giving priority to public
  expenditure where counterpart resources are provided and acceptable financial
  management systems are operating; and
• make difficult choices, avoid wasteful practices and establish priorities
  and a sequence for interventions.

Report Summary [PDF 253KB]

Enclaves and Equity: The Rural Crisis and Development Choice in Papua New Guinea [PDF 919KB ]

Available: Electronic version only

This report was commissioned by AusAID. The findings, interpretations and conclusions expressed in the report are those of the authors and do not necessarily reflect the views of AusAID or the Australian Government.

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