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June 25, 2019


Papua New Guinea


Overview
Papua New  Guinea (PNG)  lies in a region of the Southwest
Pacific known as Melanesia. It is the most populous Pacific
Island nation with about 7 million residents belonging to
hundreds of tribes speaking over 800 local languages and
dialects. It gained independence in 1975 from an
Australian-administered U.N. trusteeship. PNG is a member
of the Pacific Islands Forum and the Melanesian Spearhead
Group.

The United States has in the past played relatively minor
economic and security roles in PNG, although it has some
important interests including investment in natural gas
production, and cooperation on tuna fishing. China's
expanding influence in PNG and the region is leading to
increasing engagement by the United States with PNG,
including in coordination with Australia.

Politics
The Independent State of Papua New Guinea is a
constitutional monarchy with a parliamentary democracy.
James Marape, the son of a Seventh Day Adventist pastor
and a leader of the Huli people of PNG's highlands, was
made prime minister following the resignation of former
Prime Minister Peter O'Neill in May 2019. Marape led a
series of defections from the O'Neill government that
prompted his resignation, and defeated O'Neill's chosen
successor in a subsequent leadership vote of 101-8. Marape
has called for a review of PNG's resource laws and some
key investment projects, including a recently concluded
LNG  project with Total and ExxonMobil. Marape also has
stated PNG does not need foreign companies operating in
the timber export sector and that he wants PNG to be the
richest black Christian nation. Marape has discussed plans
to shift away from traditional partners and engage
Indonesia, Philippines, and Singapore in a bigger way.

Economy
Papua New  Guinea is richly endowed with natural
resources, including precious metals, natural gas, timber,
and fisheries. The country's real Gross Domestic Product
(GDP)  growth rate was 1.6% in 2016, 2.5% in 2017, and is
estimated to have been 0.3% in 2018. It is projected to grow
to 3.4% in 2019 as the negative impact of a February 2018
earthquake fades. PNG ranks poorly on the United Nations
Development  Program's Human  Development  Index, which
measures per capita gross national income, life expectancy,
and educational attainment (it is 153rd out of 187 countries).
PNG  has a serious HIV/AIDS problem and a weak health
system. Obstacles to PNG's economic development include
destructive weather, poor infrastructure, lack of government
capacity, official corruption, inadequate supply of skilled
workers, and unstable commodity prices. Australia (20.1%),
Singapore (17.7%), China (17.3%), and Japan (13.4%), are


PNG's  largest export markets. Only about 13% of Papua
New  Guineans have access to electricity.

Figure I. PaDua New   Guinea in Brief


U.S.   Relations   and   Assistance
The United States established diplomatic relations with
Papua New  Guinea in 1975, when PNG became
independent. According to Department of State official
statements, PNG, as the most populous Pacific Island
country, is important to peace and security in the Asia-
Pacific region and the two countries have enjoyed a close
friendship which includes a cooperative security
assistance relationship.

The Department of Defense 2019 Indo-Pacific Strategy
seeks to revitalize U.S. engagement across the Pacific
Islands including providing a total of $7 million in Foreign
Military Financing (FMF) for PNG, Fiji, and Tonga in
2018. The U.S. government also provides International
Military Education and Training (IMET) assistance to PNG
amounting to about $200,000 annually, focused on
promoting democratic values and peacekeeping capabilities
in the PNG defense force.

Other U.S. assistance includes HIV/AIDS prevention, care,
and treatment, and Pacific Islands regional programs of
which Papua New  Guinea is a member or recipient. These
include the Coral Triangle Initiative on Coral Reefs,
Fisheries, and Food Security (CTI-CFF), which aims to
sustain marine and coastal resources in the region, and the
multilateral South Pacific Tuna Treaty (SPTT). The SPTT,
established in 1988, provides access for U.S. tuna fishing
vessels to fishing areas in the region, which supplies one-
third of the world's tuna. In exchange, the American
Tunaboat Association pays licensing fees to the 14 Pacific
Island parties to the SPTT, and the United States provides
economic assistance to the Pacific Island parties totaling
$21 million annually. In 2018, at the Asia Pacific Economic
Cooperation (APEC)  Leaders Meeting in Port Moresby,


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