Papua New Guinea’s economic outlook for 2025 has drawn cautious optimism from major development institutions and regional banks, with growth forecasts converging around a stronger recovery driven by mining, agriculture, and a more resilient non-resource sector. Four significant economic reports published in June 2025—by the World Bank, Asian Development Bank (ADB), Westpac, and ANZ—highlight the potential for renewed momentum following subdued performance in 2024.
The World Bank, in its Papua New Guinea Economic Update released on 17 June, projects GDP growth of 4.7 per cent in 2025, up from 3.8 per cent the previous year. The report attributes the improvement to the ramping up of mining production, especially with the reopening of projects like Porgera, as well as consistent strength in agriculture and improving performance in services and construction. Notably, the Bank sees early signs of structural change, with non-resource sectors starting to contribute more meaningfully to the economy. However, it cautions that infrastructure deficits, weak governance, and underdeveloped public services continue to pose risks to long-term development, warning that the current momentum could falter without deeper reforms.
The ADB, in its Asian Development Outlook Update published on 13 June, takes a slightly more moderate view, forecasting 2025 growth at 4.2 per cent. While recognising similar drivers—mining, agriculture, and construction—the Bank warns of downside risks stemming from policy implementation delays, weak institutional capacity, and the country’s narrow fiscal space. The ADB notes that while current conditions are favourable, PNG’s growth could moderate beyond 2025 unless there is accelerated progress in public sector reform, infrastructure delivery, and investment facilitation.
Commercial banks have offered a more confident short-term view. Westpac, in its Pacific Markets Update issued on 20 June, also forecasts 4.7 per cent growth for 2025, noting that PNG is likely to outperform many of its Pacific peers. The report highlights improving investor sentiment and steady domestic demand, alongside expectations of increased public infrastructure spending. While acknowledging the risks from global market volatility, Westpac presents PNG as a relatively attractive destination for capital in the region.
ANZ, in its 21 June economic briefing reported by PNG Business News and Business Advantage PNG, also supports a 4.7 per cent growth projection. Unlike the other forecasts, ANZ emphasises the growing contribution of PNG’s rural economy to the recovery. It points to increased economic participation among smallholders, informal sector entrepreneurs, and regional supply chains. ANZ economists argue that these bottom-up drivers are helping to insulate the economy from external shocks and are gradually broadening the economic base beyond the traditional dependence on extractives.
While the tone varies, the four reports are broadly aligned in their near-term outlook. All agree that 2025 will likely be a year of recovery and relative strength, supported by improved performance in both resource and non-resource sectors. However, they diverge on the sustainability of this growth. The World Bank and ADB underline the importance of structural reform and improved governance, while Westpac and ANZ focus on investor confidence and grassroots resilience. For Papua New Guinea, the year ahead holds promise—but its ability to turn short-term growth into long-term transformation will depend on decisive policy execution, infrastructure development, and inclusive economic strategies that benefit the broader population.
