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COVID poses added threat to economic growth and stability

The outbreak of Covid-19 in Papua New Guinea represents an added threat to economic growth and stability, given the country’s limited capacity to manage the health crisis, according to three global economic analysts. 

On the plus side, government has raised more than K1 billion (US$286 million) ‘COVID Bonds’ from banks and super funds and Treasurer Ian Ling-Stuckey says he’ll be seeking another K1.5 billion for COVID bonds over the coming weeks.

Fitch Solutions’ Country Risk Research Unit, the latest ANZ Bank’s Pacific Insight Report and ratings agency Standard and Poor’s (S&P) have all revised down growth forecasts, with both Fitch and ANZ predicting a recession this year.

But the Bank of PNG, the central bank, thinks the impact of Covid-19 will be ‘contained’ during 2020 and will be minimal next year and 2022, according to its latest biannual Monetary Policy Statement.

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