Papua New Guinea Update

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Papua New Guinea Update Divine Word University
April 2008
High Commodity Prices and the Grower
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The state of Agriculture

• Initiatives
• Implementation
• Performance
• Issues

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• Our country is in an economic boom, with much of
  the export earnings coming from Agriculture
  commodities.
• Government has recognized the this contribution
  by putting in place a National Agriculture
  Development Plan (NADP)
• Funding for this so far is K100 million from the
  2007 supplementary budget and the 2008 budget
  (K40m and K60m respectively).
• However, the NADP is currently facing teething
  problems, which we hope will be overcome if the
  our Cabinet approves funding release guidelines
  this week.

Recognition
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The Challenge

• The most important challenge for PNG is to make
  the plan work, and it can do this through a
  carefully coordinated plan of action involving
  all players, whether public or private, directly
  and indirectly.
• That means Government MUST partner with the
  private sector so that the NADP is implemented in
  a transparent, timely and effective manner.

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The Approach

• We must pursue a multi-pronged approach,
  otherwise such efforts and resources will fail to
  achieve their planned objectives.
• Plans must be within the overall budgeting and
  planning process, so that all aspects of projects
  are clearly addressed and put into place to allow
  for smooth implementation programs.

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Government MTDS

• Lack of implementation of approved programmes is
  our worst enemy.
• We urge the Government to ensure direct
  intervention to ensure that its plans and
  priorities are effectively delivered on a timely
  basis.
• The issue here is that these policies have not
  been implemented effectively on a timely basis.

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Our Performance Past 9 years

• Prices are rising.
• . but production is falling!

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Table 1 PNG Exports Classified By Commodity (K
million fob)
Agriculture and other exports - Classified by
Commodity (K million f.o.b.)
Source BPNG Quarterly Economic Bulletin
September 2007 Issue
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Table 2 Agricultural Exports Quantities Exported
of Major Commodities (000 tonnes)
Source BPNG Quarterly Economic Bulletin
September 2007 Issue Actual Industry Figure
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Average export prices for major commodities
compared to corresponding period in 2006

• Coffee up 12.9 (to K7,389 per tonne)
• Cocoa up 18.5 (to K5,678 per tonne).
• Palm Oil up 74.3 (to K1,982 per tonne)
• Copra up 61.1 (to K920 per tonne)
• Copra Oil up 86.5 (to K2,524 per tonne)
• Tea down 9.4 (to K3,000 per tonne)
• Rubber down 5.1 (to K5,769 per tonne)

Source BPNG Quarterly Economic Bulletin
September 2007 Issue
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Export volumes in the September Quarter compared
to corresponding period in 2006

• Coffee exported 19,300 tonnes up 9.7. Increase
  due to recovery of coffee trees from
  rehabilitation and good weather.
• Cocoa exported 11,500 tonnes down 7.3.
  Decrease due to bad weather in cocoa producing
  regions
• Copra Oil exported 12,600 tonnes up 23.5.
  Increase to due to higher volumes bought by
  domestic mills for processing and export.
• Palm Oil exported 82,00 tonnes - down 13.3.
  Decrease due to bad weather in producing regions.
• Tea exported 1,300 tonnes down 18.8. No
  indication of reason for lower production.
• Rubber exported 1,300 tonnes No change in
  export volume.

Source BPNG Quarterly Economic Bulletin
September 2007 Issue
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• Infrastructure
• Law and Order
• Credit Schemes
• Training
• Extension Services
• Communications