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Papua New Guinea vs. Indonesia

Economy

Papua New GuineaIndonesia
Economy - overviewPapua New Guinea (PNG) is richly endowed with natural resources, but exploitation has been hampered by rugged terrain, land tenure issues, and the high cost of developing infrastructure. The economy has a small formal sector, focused mainly on the export of those natural resources, and an informal sector, employing the majority of the population. Agriculture provides a subsistence livelihood for 85% of the people. The global financial crisis had little impact because of continued foreign demand for PNG's commodities.

Mineral deposits, including copper, gold, and oil, account for nearly two-thirds of export earnings. Natural gas reserves amount to an estimated 155 billion cubic meters. Following construction of a $19 billion liquefied natural gas (LNG) project, PNG LNG, a consortium led by ExxonMobil, began exporting liquefied natural gas to Asian markets in May 2014. The project was delivered on time and only slightly above budget. The success of the project has encouraged other companies to look at similar LNG projects. French supermajor Total is expected to begin construction on the Papua LNG project by 2020. Due to lower global commodity prices, resource revenues of all types have fallen dramatically. PNG’s government has recently been forced to adjust spending levels downward.

Numerous challenges still face the government of Peter O'NEILL, including providing physical security for foreign investors, regaining investor confidence, restoring integrity to state institutions, promoting economic efficiency by privatizing moribund state institutions, and maintaining good relations with Australia, its former colonial ruler. Other socio-cultural challenges could upend the economy including chronic law and order and land tenure issues.
Indonesia, the largest economy in Southeast Asia, has seen a slowdown in growth since 2012, mostly due to the end of the commodities export boom. During the global financial crisis, Indonesia outperformed its regional neighbors and joined China and India as the only G20 members posting growth. Indonesia’s annual budget deficit is capped at 3% of GDP, and the Government of Indonesia lowered its debt-to-GDP ratio from a peak of 100% shortly after the Asian financial crisis in 1999 to 33% today. While Fitch and Moody's Investors upgraded Indonesia's credit rating to investment grade in December 2011, Standard & Poor’s has yet to raise Indonesia’s rating to this status amid several constraints to foreign direct investment in the country, such as a high level of protectionism.

Indonesia still struggles with poverty and unemployment, inadequate infrastructure, corruption, a complex regulatory environment, and unequal resource distribution among its regions. President Joko WIDODO - elected in July 2014 – seeks to develop Indonesia’s maritime resources and pursue other infrastructure development, including significantly increasing its electrical power generation capacity. Fuel subsidies were significantly reduced in early 2015, a move which has helped the government redirect its spending to development priorities. Indonesia, with the nine other ASEAN members, will continue to move towards participation in the ASEAN Economic Community, though full implementation of economic integration has not yet materialized.
GDP (purchasing power parity)$30.84 billion (2017 est.)
$29.92 billion (2016 est.)
$29.22 billion (2015 est.)
note: data are in 2017 dollars
$3.243 trillion (2017 est.)
$3.084 trillion (2016 est.)
$2.937 trillion (2015 est.)
note: data are in 2017 dollars
GDP - real growth rate3.1% (2017 est.)
2.4% (2016 est.)
9.2% (2015 est.)
5.2% (2017 est.)
5% (2016 est.)
4.9% (2015 est.)
GDP - per capita (PPP)$3,800 (2017 est.)
$3,800 (2016 est.)
$3,800 (2015 est.)
note: data are in 2017 dollars
$12,400 (2017 est.)
$11,900 (2016 est.)
$11,500 (2015 est.)
note: data are in 2017 dollars
GDP - composition by sectoragriculture: 22.1%
industry: 42.9%
services: 35% (2017 est.)
agriculture: 13.9%
industry: 40.3%
services: 45.9% (2017 est.)
Population below poverty line37% (2002 est.)
10.9% (2016 est.)
Household income or consumption by percentage sharelowest 10%: 1.7%
highest 10%: 40.5% (1996)
lowest 10%: 3.4%
highest 10%: 28.2% (2010)
Inflation rate (consumer prices)5.8% (2017 est.)
6.7% (2016 est.)
4% (2017 est.)
3.5% (2016 est.)
Labor force3.681 million (2017 est.)
126.1 million (2017 est.)
Labor force - by occupationagriculture: 85%
industry: NA%
services: NA% (2005 est.)
agriculture: 32%
industry: 21%
services: 47% (2016 est.)
Unemployment rate2.5% (2017 est.)
2.5% (2016 est.)
5.4% (2017 est.)
5.6% (2016 est.)
Distribution of family income - Gini index50.9 (1996)
36.8 (2009)
39.4 (2005)
Budgetrevenues: $3.649 billion
expenditures: $4.763 billion (2017 est.)
revenues: $130.6 billion
expenditures: $154.8 billion (2017 est.)
Industriescopra crushing, palm oil processing, plywood production, wood chip production; mining (gold, silver, copper); crude oil and petroleum products; construction, tourism
petroleum and natural gas, textiles, automotive, electrical appliances, apparel, footwear, mining, cement, medical instruments and appliances, handicrafts, chemical fertilizers, plywood, rubber, processed food, jewelry, and tourism
Industrial production growth rate3.3% (2017 est.)
3.8% (2017 est.)
Agriculture - productscoffee, cocoa, copra, palm kernels, tea, sugar, rubber, sweet potatoes, fruit, vegetables, vanilla; poultry, pork; shellfish
rubber and similar products, palm oil, poultry, beef, forest products, shrimp, cocoa, coffee, medicinal herbs, essential oil, fish and its similar products, and spices
Exports$9.526 billion (2017 est.)
$9.224 billion (2016 est.)
$157.8 billion (2017 est.)
$144.4 billion (2016 est.)
Exports - commoditiesoil, gold, copper ore, logs, palm oil, coffee, cocoa, crayfish, prawns
mineral fuels, animal or vegetable fats (includes palm oil), electrical machinery, rubber, machinery and mechanical appliance parts
Exports - partnersSingapore 23.7%, Australia 22.9%, Japan 13.2%, China 11.9% (2016)
China 11.6%, US 11.2%, Japan 11.1%, Singapore 7.8%, India 7%, Malaysia 4.9%, South Korea 4.8% (2016)
Imports$1.878 billion (2017 est.)
$2.267 billion (2016 est.)
$142.3 billion (2017 est.)
$129 billion (2016 est.)
Imports - commoditiesmachinery and transport equipment, manufactured goods, food, fuels, chemicals
mineral fuels, boilers, machinery, and mechanical parts, electric machinery, iron and steel, foodstuffs
Imports - partnersAustralia 36%, China 14.9%, Singapore 8.5%, Malaysia 7.5% (2016)
China 22.9%, Singapore 10.8%, Japan 9.6%, Thailand 6.4%, US 5.4%, Malaysia 5.4%, South Korea 5% (2016)
Debt - external$17.09 billion (31 December 2017 est.)
$18.28 billion (31 December 2016 est.)
$322.6 billion (31 December 2017 est.)
$316.5 billion (31 December 2016 est.)
Exchange rateskina (PGK) per US dollar -
3.179 (2017 est.)
3.133 (2016 est.)
3.133 (2015 est.)
2.7684 (2014 est.)
2.4614 (2013 est.)
Indonesian rupiah (IDR) per US dollar -
13,360.1 (2017 est.)
13,308.3 (2016 est.)
13,308.3 (2015 est.)
13,389.4 (2014 est.)
11,865.2 (2013 est.)
Fiscal yearcalendar year
calendar year
Public debt39.8% of GDP (2017 est.)
39% of GDP (2016 est.)
33.1% of GDP (2017 est.)
31.5% of GDP (2016 est.)
Reserves of foreign exchange and gold$1.8 billion (31 December 2017 est.)
$1.656 billion (31 December 2016 est.)
$122.5 billion (31 December 2017 est.)
$116.4 billion (31 December 2016 est.)
Current Account Balance$4.053 billion (2017 est.)
$4.119 billion (2016 est.)
-$17.03 billion (2017 est.)
-$16.77 billion (2016 est.)
GDP (official exchange rate)$21.81 billion (2016 est.)
$1.011 trillion (2016 est.)
Stock of direct foreign investment - at home$NA
$247.7 billion (31 December 2017 est.)
$229.1 billion (31 December 2016 est.)
Stock of direct foreign investment - abroad$NA
$19.96 billion (31 December 2017 est.)
$18.42 billion (31 December 2016 est.)
Market value of publicly traded shares$10.71 billion (31 December 2012 est.)
$8.999 billion (31 December 2011 est.)
$9.742 billion (31 December 2010 est.)
$428.2 billion (31 December 2016 est.)
$353.3 billion (31 December 2015 est.)
$422.1 billion (31 December 2014 est.)
Central bank discount rate14% (31 December 2010)
6.92% (31 December 2009)
6.37% (31 December 2010)
6.46% (31 December 2009)
note: this figure represents the 3-month SBI rate; the Bank of Indonesia has not employed the one-month SBI since September 2010
Commercial bank prime lending rate8.4% (31 December 2017 est.)
8.38% (31 December 2016 est.)
11.3% (31 December 2017 est.)
11.89% (31 December 2016 est.)
note: these figures represent the average annualized rate on working capital loans
Stock of domestic credit$7.859 billion (31 December 2017 est.)
$7.223 billion (31 December 2016 est.)
$436.7 billion (31 December 2017 est.)
$397.7 billion (31 December 2016 est.)
Stock of narrow money$5.495 billion (31 December 2017 est.)
$5.05 billion (31 December 2016 est.)
$107.6 billion (31 December 2017 est.)
$92.11 billion (31 December 2016 est.)
Stock of broad money$7.649 billion (31 December 2017 est.)
$7.061 billion (31 December 2016 est.)
$407.6 billion (31 December 2017 est.)
$372.5 billion (31 December 2016 est.)
Taxes and other revenues16.7% of GDP (2017 est.)
12.9% of GDP (2017 est.)
Budget surplus (+) or deficit (-)-5.1% of GDP (2017 est.)
-2.4% of GDP (2017 est.)
GDP - composition, by end usehousehold consumption: 45%
government consumption: 20.3%
investment in fixed capital: 10.4%
investment in inventories: -0.3%
exports of goods and services: 47.6%
imports of goods and services: -23% (2017 est.)
household consumption: 57.5%
government consumption: 8.9%
investment in fixed capital: 32.1%
investment in inventories: 0.7%
exports of goods and services: 19.2%
imports of goods and services: -18.4% (2017 est.)
Gross national saving40.8% of GDP (2017 est.)
44.5% of GDP (2016 est.)
39.8% of GDP (2015 est.)
32.6% of GDP (2017 est.)
32.5% of GDP (2016 est.)
32.1% of GDP (2015 est.)

Source: CIA Factbook