An overview of development aid in Papua New Guinea, including the country’s main aid donors and types of aid.

The International Convention Centre in Port Moresby, funded by Chinese aid, under construction in 2018. Credit: BAI

According to the Papua New Guinea Treasury’s Final Budget Outcome for 2019, the country received K1.7756 billion in donor aid in 2019. Of this, K1.4085 billion came from foreign governments and K367.1 million from international organisations. Profiles of PNG’s major aid donors follow.

Australia

Australia is PNG’s largest aid donor, providing an estimated A$607.5 (K1.517 billion) in total development aid to PNG in 2019-20.

Australia’s aid program that three stated goals: promoting effective governance, enabling economic growth and enhancing human development.

Key programs and projects delivered under Australia’s aid program include the PNG-Australia Governance Partnership, the Economic and Social Infrastructure Program, the Coral Sea Cable System, the Transport Sector Support Program, the Law and Justice program and the Australian Council for Agricultural Research’s PNG program, which focuses on enhancing PNG’s agriculture, fisheries and forestry sectors.

In future, Australia’s aid program to PNG is expected to be guided in part by the Comprehensive Strategic and Economic Partnership (CSEP) signed between the two countries in August 2020. The two countries also conduct an annual bilateral ministerial forum.

With Japan, the United States and New Zealand, Australia is also a member of the Papua New Guinea Electrification Partnership, which has the stated goal of providing 70% of Papua New Guineans with access to electricity by 2030. Some of Australia’s support for this program is expected to be delivered through the Australian Infrastructure Finance Facility for the Pacific (AIFFP).

Australia’s Department of Foreign Affairs and Trade is the main coordinating agency for Australia’s aid program in PNG.

United Nations

The UN is a major donor to Papua New Guinea. In 2019, it dispersed US$69.4 million in aid through 15 separate UN agencies.

The UN’s aid efforts in PNG are directed by a joint partnership document, the United Nations Development Assistance Framework 2018-2022, which is broadly aligned to PNG’s sustainable development goals.

Recent programs funded under the four aid pillars of ‘People, Peace, Prosperity and Planet’ include vaccination, hygiene and reproductive health programs, support for the 2019 Bougainville independence referendum, support for financial inclusion and market access support for PNG’s coffee sector.

The UN has an office in Port Moresby, as do 11 of its agencies.

China

China has been a significant aid donor to Papua New Guinea over the the past decade. Chinese aid often takes the form of infrastructure or construction projects funded by concessional loans or donations.

Papua New Guinea signed up to China’s Belt and Road Initiative in 2018, a move aimed to boost PNG’s ‘trade, energy, infrastructure and industrial production capacity’.

Recent Chinese aid-funded projects include the Kokopo Town Sewerage Project, Butuka Academy of Papua New Guinea, and the International Convention Centre in Port Moresby.

China’s official development aid organisation is the China International Development Cooperation Agency (CIDCA).

United States

The United States has invested over US$108 million (K376 million) in total aid in Papua New Guinea over the past 20 years, including more than US$52 million (K181 million) for health. It recently announced a doubling of its aid support for PNG for 2020.

Programs delivered under the aid program include the K66 million Lukautim Graun (care for the environment) project, support for women entrepreneurs, disaster preparedness and support for HIV/AIDs.

With Australia, Japan and New Zealand, the US is also a member of the Papua New Guinea Electrification Partnership, which has the stated goal of providing 70% of Papua New Guineans with access to electricity by 2030. In 2019, the US initiated a 5-year US$60 million program in support of this partnership.

The primary coordinating agency for the US aid program in PNG is the United States Agency for International Development (USAID).

New Zealand

New Zealand has committed NZ$108.23 (K246 million) in aid to PNG in the three years 2018 to 2021.

New Zealand’s aid to PNG prioritises investment in economic sectors and infrastructure, health, education, law and justice.

Japan

Japan has had an ongoing aid program in PNG since 1974. It spent 189.18 billion Yen (K6.23 billion) on PNG aid between 1974 and 2018.

Its aid program is intended to align with the development objectives of PNG’s national planning strategy.

Its program has three areas of focus: strengthening the foundation of economic growth, the improvement of social services, and the environment and climate change.

Key projects delivered under this program include the Nadzab Airport Redevelopment Project, the Ramu Transmission System Reinforcement Project, the rehabilitation of Alotau’s town market and fisheries facility, and the Port Moresby Sewerage System Upgrading Project.

With Australia, the United States and New Zealand, Japan is also a member of the Papua New Guinea Electrification Partnership, which has the stated goal of providing 70% of Papua New Guineans with access to electricity by 2030.

The coordinating agency for Japanese aid in PNG is the Japan International Cooperation Agency (JICA).