Overview of Papua New Guinea Economy, 2007 to 2014
The level of current price GDP increased from 28.3 billion kina in 2007 to 56.6 billion Kina in 2014 while the constant price GDP increased from 37.0 million Kina in 2006 to 53.7 billion Kina in 2014. The current and constant price GDP figures are the same in 2013 as the year 2013 is the base year for the calculation of constant price GDP estimates; thus, the constant price estimates are all in 2013 prices whereas the current price GDP is valued using the prices prevailing in the respective years.
Aggregate GDP At Constant Purchasers’ Values
GDP at constant prices of 2013 grew by an average of 5.8 % over the years from 2007 to 2014. Basically, GDP at constant purchasers prices of 2013 were derived using single price deflation method where gross value added of all individual industries were deflated with appropriate price deflators. Real growth of aggregate GDP in 2010 was deemed to be the highest with 10.1 % which implies and signifies the peak level of production in teams of volume in any one year during the period from 2007 to 2014. The high growth of 12.5 % in 2014 was the impact of first production of the LNG in PNG. Moderate growths were reported for 2012 and 2013 with 4.7 % and 3.8 % respectively.
Over the period from 2006 to 2014, current price GDP increased by 121.7 % and constant price GDP increased by 56.3 %. The current price GDP increased at a greater rate than the constant price GDP as it includes both increases in volume and in prices, whereas constant price GDP only includes changes in the volume of goods and services produce in PNG. For example, in 2008, current price GDP decreased by 0.3 % (only volume increases). The difference between the two measures is prices which would suggest strong price increases in the PNG economy in 2008 of approximately 11.7 %.
For a more detailed description of current price GDP including level and growth by industry, please refer to 2006 – 2013 PNG National Accounts publication released on 23 March 2016.
GDP per Capita increased from 2007 level of K4,399 to K7,099 in 2014 (Figure 3), this equates to an average increase in GDP per capita of 7.3 percent per annum (in Current Prices). There was a decline in the GDP per Capita in 2009 (-1.5) which was an effect of the population (up 3.1%) growing faster than current GDP (up 1.6%). However in the following year 2010, there was a turn around and PNG recorded it’s strongest GDP per Capita with an increase of 17.4 percent.
Industry Share of GVA
Current Price Estimates
For the period 2007 to 2014, the three highest contributing industries were Agriculture, Forestry & Fishing, Mining & Quarrying and Wholesale & Retail Trade. These three industries together contribute nearly half of PNG’s GDP.
From 2009 to 2013, Agriculture, Forestry and Fishing sector was the highest contributor with Gross Value added (GVA) share of 22.4 percent in 2009, 20.2 percent in 2010, 19.7 in 2011, 20.0 in 2012, 20.0 in 2013 and 18.8 percent 2014. Mining and quarrying, on the other hand, was the highest contributor in 2007, 2008 and 2009 with 26.4 percent, 26.1 percent and 19.1 percent respectively. However, its’ contribution of Value Added fell in 2011 and continued the trend to 2013 where its share was 14.1 percent. In 2014 the industry took over the lead by a massive growth of 322.6% due to the production of Liquefied Natural Gas (LNG), value added to the industry by K5.4 billion. Wholesale and Retail Trade maintained its’ place as the third major contributor right throughout the period in review. Construction industry and Real Estate Activities followed the similar trends, See Tables 9 and 10 for details of the industry shares of Gross Value Added.
CLICK TO DOWNLOAD Document (below)