World Bank approves $ 100 million to support Papua New Guinea’s sustainable recovery
The World Bank Board of Directors today approved a US $ 100 million operation (equivalent to PGK 352 million) to support Papua New Guinea in its response to COVID-19 and to lay the groundwork important aspects of a sustainable recovery.
As the economy of Papua New Guinea entering the COVID-19 crisis with limited resilience to external shocks, the pandemic has resulted in a sharp economic contraction, rising unemployment and many more Papua New Guinea falling into poverty, especially women and young people.
The Crisis Response and Sustainability Operation in Papua New Guinea aims to strengthen PNG’s health system, support the livelihoods of vulnerable households and small businesses; and lay the vital foundations for a more sustainable economic recovery.
“It is undeniable that the COVID-19 pandemic has had a severe impact on our country,” said Papua New Guinea’s Treasury Minister, the Hon. Ian Ling-Stuckey. “However, we have been proactive in taking steps to establish a clear stimulus package to help stabilize the economy, maintain frontline health services, and provide support to the business sector, especially those in the MSME space, among others.
“Beyond the COVID crisis, the Marape government is firmly committed to resuming fiscal consolidation to ensure fiscal and debt sustainability and this operation is a strategic partnership with the World Bank to achieve this. “
Stefano Mocci, World Bank Country Director for Papua New Guinea, said: “Globally, the COVID-19 crisis has tested the resilience of many economies; and PNG is no exception.
“To prepare the PNG economy for a sustainable recovery, this operation supports the efforts of the PNG government to strengthen the country’s medium-term fiscal and debt sustainability, improve the efficiency of the financial sector, ensure that more people – especially PNG’s most vulnerable families and communities – have better access to finance and to cope with the impacts of climate change. “
This funding will help protect routine health services while ensuring the roll-out of COVID-19 vaccinations, help provide financial support to micro, small and medium-sized enterprises (MSMEs) for job protection and ease the burden of small business tax administration.
It will also support the government’s commitment to ensure fiscal and debt sustainability, strengthen women’s voice and opportunities in decision-making, improve financial sector efficiency and financial inclusion, and prepare PNG to the imminent impacts of climate change.
Beyond the current crisis, the World Bank operation is closely aligned with the national plans of the Government of PNG and will support the commitment of the Government of PNG to resume much needed fiscal consolidation in the post period. -crisis, in order to address the main structural challenges of fiscal and debt sustainability.
The operation is in line with the World Bank Group Country Partnership Framework for Papua New Guinea 2019-2023 and will be carried out through highly concessional credit through the International Development Association ( IDA), the World Bank Group fund for the world’s poorest. countries.
The World Bank is working in close coordination with key development partners, including the International Monetary Fund, the Asian Development Bank, the Australian government, the Japan International Cooperation Agency and the United Nations to strengthen support for the resilient recovery of Papua New Guinea.
The World Bank works in partnership with 12 Pacific countries, supporting 85 projects totaling $ 2 billion in commitments in sectors such as agriculture, aviation and transport, resilience and adaptation to climate change, economic policy, education and employment, energy, fisheries, health, management, rural development, telecommunications and tourism.