Publications

Declining purchasing power of minimum wages in Papua New Guinea: Analysis of economic access to healthy diets

Key Messages
To address rising living costs which reduce the purchasing power of the minimum wage, the Government of PNG recently launched a review of the country’s minimum wage. The minimum wage has been PGK 3.50 per hour or PGK 28 per 8-hour day since July 2016. At the beginning of 2025, the minimum wage could purchase about three-quarters as much food and other goods and services compared to July 2016. The cost of a healthy diet per adult per day in urban areas increased by 35 percent from PGK 7.70 in 2021 to PGK 10.37 in 2025. The cost of the healthy diet was the most expensive in Port Moresby—PGK 11.15 per adult per day in 2025 and increased the most in Kokopo (54 percent) from PGK 5.81 to PGK 8.92 between 2021 and 2025. One and a half full-time urban minimum wage earners earn just enough to feed a healthy diet to a family of five in 2025, with no money remaining for essential non-food expenses such as clothing, shelter, transportation, health, and education. The government recently published a public notice of Goods and Services Tax (GST) zero-rating of essential goods effective 1st June 2025 to 30th June 2026. We re-evaluate the purchasing power of a minimum wage by decreasing the price of tinned tuna and rice by 10% (reflective of the GST zero-rating) on Q1 2025 recorded prices. Assuming prices remain constant (with no shifts in demand due to decreased tax), the cost of the average urban healthy diet in the first quarter of 2025 is 4.7 percent lower without the GST (PGK 9.87) compared to the cost of a healthy diet with the GST (PGK 10.35) — slightly improving the purchasing power of minimum wage earners.

Papua New Guinea: Systematic analysis of world market and domestic production shocks

This study is part of a series of country briefs by IFPRI that leverages economywide models to deliver detailed risk assessments of key economic indicators. This initial analysis evaluates vulnerabilities across economic sectors and key population groups to answer two questions: (1) How vulnerable are national economy and population of Papua New Guinea (PNG) to world market and domestic production shocks? (2) What are the largest risks to PNG’s overall economic performance, private consumption, and reductions in poverty and undernourishment?

Papua New Guinea Rural Household Survey, 2023

The Papua New Guinea Rural Household Survey (2023) collected detailed household-level data on agricultural production, food and non-food consumption and expenditure, and livelihood strategies across 14 provinces, covering communities in the highlands, lowlands, and islands of Papua New Guinea (PNG). The survey was designed using a purposive sampling strategy based on defined agro-ecological zones, which allows for the analysis of key factors influencing rural households and communities. It is important to note that the survey is not nationally representative; however, given the careful random selection of survey areas, we expect that generalizable relationships between variables affecting socio-economic and other development outcomes in rural PNG communities will be consistently observed across representative samples and in this survey. These factors include those that contribute to more resilient local food systems, diversified employment opportunities, and improved household wellbeing. The survey encompasses 2,699 households in 270 communities, spanning five agroecological zones. It features detailed modules on a wide range of topics relevant to rural livelihoods, agricultural production, and household wellbeing.

Preferences for ecosystem payment programs in Papua New Guinea

We evaluate forest landholders’ preferences to enter a hypothetical Payment for Ecosystem Service (PES) contract (i.e., voluntary carbon credit contract) and assess the relative importance of different program attributes that influence forest landholder preference for such contracts.
When evaluating the attractiveness of PES contracts for forest landholders, analysis suggests that on average, forest landholders are not inclined to enter a PES contract. However, when evaluating differences among households, a variety of characteristics shape the willingness to accept a PES contract, including:
 Landholders that are aware of climate change impacts and those from communities that previously participated in forest protection programs are more likely to accept a PES contract.
 Households that use forested land for commercial logging or hunting grounds are more inclined to accept a PES contract, viewing these contracts as an opportunity to protect forest goods and services.
 Households that rely on forested land for timber harvesting for personal building purposes are less likely to join a PES program, viewing contracts as restrictive to personal land use needs.
When assessing different levels of contract attributes (e.g., payment amount, forest area requirement, and contract length), analysis suggests that forest landholders are more likely to accept a contract that:
 Offers higher financial incentives
 Requires half of their forested land to be under contract (compared to all of their forested land).
On average, forest landholders require an additional annual compensation of $39.07 USD (152 PGK) per hectare to accept PES contracts that require full forested land preservation compared to preserving half of their forested land.

Climate change and the impact on taro in Papua New Guinea

In this paper we present a brief summary of recent historical climate of Papua New Guinea (PNG), finding that rainfall has been increasing greatly compared to pre-1995 levels, but that temperature has only been rising at a moderate rate. We then examine the 5 climate models used in this study from the Inter-governmental Panel on Climate Change (IPCC) / ISIMIP / CMIP3b, discovering one – IPSL – which best reflects the climate trends noted in PNG since 1995. The climate model projections show that temperature changes in PNG are expected to be less than most other places in the world and precipitation changes in PNG are projected to be higher than most other places in the world. Despite noting that IPSL seems to best represent climate changes observed thus far, we use all 5 climate models in the DSSAT crop model for taro, investigating how each climate model will lead to changes in taro yields at each half-degree pixel. In the aggregate, we find that the IPSL model leads to the greatest projected reduction in taro yield at -6.4% for the nation, with Southern region projected to have greater than 10% yield reduction for taro. Across the 5 climate models, the median across model results suggest only a 1.6% yield reduction, while the most optimistic model projects a 4.4% gain. Because of uncertainty across climate models and different impacts across regions, as well as potentially increasing climate variability which would lead to more extreme events including droughts and floods, we recommend developing a suite of options to help farmers navigate future climate uncertainty. For example, developing and testing crop varieties that would offer better yields whether the future is wetter or drier, as well as varieties that are less sensitive to temperature extremes. These could include new varieties of taro but might also include alternative crops and farming techniques designed to protect the plants during ad-verse climate events.

Papua New Guinea: Systematic analysis of domestic production and world market shocks

Using an economy-wide, multi-sectoral model, this study explores potential vulnerability of Papua New Guinea (PNG) to economic shocks and identifies factors that contribute most to economic uncertainty. Economic scenarios were developed using historical data on volatile domestic sectors (e.g., primary agriculture and hydropower electricity generation) and world prices of goods and services in which PNG trades. The Computable General Equilibrium (CGE) model of PNG was used to simulate a range of potential economic outcomes under these scenarios. In addition, data mining and machine learning methods were applied to quantify the contribution of each shock to the uncertainty of economic outcomes. Key findings suggest that Papua New Guinea’s economy is predominantly exposed to external risks, with world prices and foreign capital volatility together accounting for approximately two-thirds of the potential variation in GDP and three-fourths of the potential variation in private consumption, poverty, and undernourishment (domestic production volatility contributes the remaining one-third and one-fourth, respectively). The current structure of the PNG economy underpins these results. While agriculture is the most uncertain sector, it is relatively less important compared to the overall economy; export earnings from energy and metals, as well as volatile foreign exchange capital inflows, play a much more significant role in the country’s current economic risks. Understanding how potential shocks might impact various segments of the PNG economy and population is a critical first step in facilitating discussions on relevant risk mitigation strategies, such as increasing sectoral productivity or diversifying production away from high-risk sectors.

Household wellbeing in rural Papua New Guinea: Analysis from the 2023 PNG Rural Household Survey

Key Messages
 The PNG 2023 Rural Household Survey collected detailed consumption and expenditure data, which allows the first cost of basic needs poverty assessment since the 2009/10 Household Income Expenditure Survey. However, it is important to note that the survey is not nationally representative.
 43% of sample individuals are estimated to be poor relative to the standard cost of basic needs poverty lines (poor is defined as those who live in households that do not have sufficient resources to acquire calorie adequate diets while also meeting basic non-food needs).
 64% of sample individuals are estimated to be poor relative to the healthy diet poverty lines (poor is defined as those who live in households that do not have sufficient resources to meet healthy dietary guidelines while also meeting basic non-food needs).
 The healthy diet poverty line incorporates a higher share of nutrient dense food groups (vegetables, fruits, meat and fish, etc.) and thus is about 1/3 more costly than the standard poverty line.
 On average, households within the survey sample over-consume staples and fats compared to healthy guidelines and under-consume vegetables, fruits, animal source foods, and nuts/pulses.
 Smaller households and households with greater production assets (land and labor), education completion, market access, and income diversification (via non-farm businesses and migrant remittances) are associated with higher household consumption-expenditure (income proxy).
 Among households engaged in cash crop sales (i.e., cocoa, coffee, betelnut, horticulture) only cocoa farming households have significantly higher consumption-expenditure (income proxy).
 Targeted safety net and community asset building programs could reduce rural poverty by increasing agriculture productivity, supporting rural-urban market linkages, improving demand for rural goods, and incentivizing off-farm employment.
 Facilitating remittance transfers from migrants to rural households and facilitating access to primary education could improve rural incomes in the short and long term, respectively.

‘Gold runs through these trees’: Preferences for ecosystems payment programs in Papua New Guinea

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Payment for Ecosystem Services (PES) programs (such as REDD+ and voluntary carbon credit programs) have been designed to provide improved forest governance, reduced carbon emissions and diversified income sources for forest communities. However, recent evaluations of REDD+ projects across diverse countries have shown mixed results. In 2022, the government of Papua New Guinea put a moratorium on voluntary carbon credit programs due to inadequately specified processes on contract design and targeting, resulting in ongoing deforestation and lack of transparent remuneration in participating communities under select programs. As the country reassesses how to engage in voluntary carbon credit programs, this study aims to inform the design of PES programs tailored to meet the needs of forest landholders. Using recently collected rural household survey data, we evaluate the unique characteristics that are correlated with forest-owning households’ likelihood of accepting a PES contract. The discrete choice experiments included in the survey, and complementary focus group discussions suggest that forest landholders prefer PES contracts with higher financial incentives and lower land area commitments, requiring an additional $39.07 per hectare per year to preserve all forested land compared to committing half of their forested land to a PES contract. Other factors, such as household size, the use of forest land for timber production and commercial logging, ongoing forest preservation activities within a community and market access also influence respondents’ preferences for PES contracts.

Household wellbeing in rural Papua New Guinea: Poverty analysis from the 2023 PNG Rural Household Survey

This analysis provides the first poverty assessment using the cost of basic needs approach in Papua New Guinea in 1.5 decades. The cost of basic needs poverty methodology is the standard approach to estimating poverty in low- and middle-income countries. It aims to reflect the cost of a food basket and nonfood needs to secure a healthy life and minimum standard of living. Using the cost of basic needs approach, we calculate and compare two poverty measurements. First, we compute a standard (traditional) cost of basic needs poverty line where the food poverty line is defined by a dietary energy (calorie) threshold. Second, we extend the standard cost of basic needs approach to calculate a healthy diet food poverty line that meets both the dietary energy threshold, as well as recommended nutrition targets.

Results suggest that 43 percent of sample individuals live below the standard cost of basic needs poverty line. When recalculating the poverty line to account for a healthy diet threshold (a mix of food groups set at quantities consistent with dietary guidelines), we find that 64 percent of the sample is below the healthy diet poverty line. On average, households within the survey sample over-consume the recommended daily quantity of staples and fats, however daily consumption of vegetables, fruits, and protein-rich foods (e.g., fish, meat, nuts) fall short of recommended targets.

The above poverty analysis begs the question of what characteristics are associated with higher income earning households (we use per capita consumption-expenditure as the rural income proxy). Regression analysis suggests that greater production assets (land and labor), education, market access, and income diversification (via non-farm businesses and migrant remittances) are associated with higher household incomes. While we hypothesized that households engaged in cash crop sales (i.e. cocoa, coffee, betelnut, horticulture) would be significantly better off, we find that only cocoa farming households have significantly higher incomes.

The regression analysis reveals that facilitated access to a market is one of the most important indicators explaining per capita consumption-expenditure (i.e. income per person). Households that are more than 4 hours from a market have about 25 percent less income compared to households that are within 2 hours from a market. Conversely, households that report owning a small business (non-farm enterprise) are associated with approximately 25 percent greater consumption-expenditure per capita. While market access and income diversification are important to household incomes, weather shocks such as floods are associated with significant declines (8 percent) in per capita consumption-expenditure. Given the above results, a pilot social safety net program in more remote (greater than 4 hours from a market) and flood prone areas, where household incomes are significantly lower, may provide important insights on the most efficient mechanisms to build resilience among PNG’s vulnerable population. Including a community asset building component (e.g., building and maintenance of rural feeder roads and bridges) in the social safety net program could be tested to understand how best to support rural-urban market linkages and incentivize off-farm employment.

Understanding that a social safety net program requires significant resourcing (including financial, logistics and time), there are other opportunities to improve rural welfare within the country. Facilitating remittance transfers from migrants to rural households via electronic banking services and easing banking costs for rural households may increase remittance payments. In addition, facilitating access to primary education via reduced school fees and increasing school attendance via school feeding programs could provide greater income earning opportunities for better educated households, as well as (if designed properly) fill some of the nutrition gaps demonstrated by the large share of individuals that live under the healthy diet poverty line presented in this paper.

Papua New Guinea food price bulletin: January 2025

Download time series food price data, and build graphs and tables for over 20 different food crops at our food price database webpage: https://www.ifpri.org/project/fresh-food-price-analysis-papua-new-guinea/ Price trends: Quarterly comparisons (Q4 2024 vs. Q4 2023 and Q4 2022) Sweet potato prices in Q4 of 2024 were 20.4 percent higher in all markets compared to Q4 of 2023 (averaging 1.64 PGK/kg in Q4 of 2023, and 1.79 PGK/kg in 2024). However, sweet potato prices in Kokopo were 13 percent lower in 2024 (1.35 PGK/kg) compared to 2023 Q4 price (1.55/PGK/kg) Rice prices have increased slowly (but remained stable) since 2022. Compared to Q4 2023, rice prices in 2024 were 14 percent higher in Kokopo, Lae and Port Moresby. Vegetable prices, on average, in Q4 of 2024 were 23.6 lower in Goroka compared to Q4 of 2023. Compared to Q4 2022, the price of vegetables, on average, in 2024 were 22.1 percent lower in highland markets. Fruits saw mixed price movements between 2023 and 2024: lemon prices in Q4 2024 were 28.4 percent lower, on average, across all markets.

Child growth and development in rural Papua New Guinea

Papua New Guinea food price bulletin: October 2024

This report provides an analysis of food price trends for the third quarter of 2024, covering the period from July to September. During this quarter, two rounds of data were collected per month from Kokopo, Banz, and Port Moresby in July and August. However, in September, only one round of data was collected from all markets except Port Moresby (no data collected). Only one round of data was collected in Goroka for each month in the 3rd quarter. In Lae, food price data was collected only once in August for the entire third quarter. These data gaps affect the comparability of the reported price trend and caution should be used to draw conclusions on price fluctuations. The graphs in this bulletin show price changes within the third quarter and compare the third quarter prices with the second quarter of 2024, between April and June. To access the complete food price dataset and interactive food price graphing tool, please visit our website.

Poultry value chain and cluster development in Papua New Guinea: Insights from a recent field study

Despite poultry being lauded as a relatively affordable source of protein and micronutrients in many lower-income countries, chicken meat is twice as expensive in PNG compared to nearby Southeast Asian countries. Recent rural household consumption data collected by the International Food Policy Research Institute (IFPRI) suggests that an important share of households do not eat enough protein to meet healthy dietary guidelines (Schmidt et al., 2024). Poultry, along with fish and pork, are the three most important animal-source protein foods in the country, yet these products remain financially prohibitive to a large share of the population.

This paper explores the unique challenges and opportunities within PNG’s poultry sector using a "growth diagnostic" approach (pioneered by Rodrik, 2010). Through interviews with key stakeholders across the poultry value chain, we found that while high feed costs persist as a significant challenge, poultry farmers have yet to adopt additional cost-reduction strategies, such as establishing small-scale regional feed mills, utilizing local feed ingredients, and diversifying feed and input imports. An intriguing puzzle of PNG’s poultry sector is the limited number of small-scale producers successfully transitioning to medium-scale operations. This primarily stems from high transport costs and restricted access to input and sales markets. The challenges of marketing chicken in PNG have received less attention than production. Drawing on the experiences of successful models in other countries and considering the specific situation of PNG's poultry sector, fostering poultry production and processing clusters (e.g., in Lae suburban areas) emerges as a potential strategy to address production, transportation, and marketing constraints. By concentrating production, value chain clustering can enhance access to essential services (e.g. slaughtering and cold storage), improve market access, and reduce overall costs. While clustering holds promise for PNG’s poultry value chain, its success hinges upon joint action between the public and private sectors, as well as NGOs operating within the value chain.

The agrifood system in PNG: Structure and drivers of transformation

Although the economy of Papua New Guinea is heavily influenced by the oil and natural gas sector, which accounts for 30 percent of GDP and most of the country’s foreign exchange earnings, small-scale agriculture continues to be the major source of livelihoods for most of the population. Much of the food crop production (particularly starchy staples such as sweet potatoes, cassava, yams and sago) is not traded internationally; however, oil palm, coffee and cocoa are major exports. A large share of agricultural production undergoes little value-added through processing and much of it is consumed by farm households themselves. Thus, there would appear to be substantial scope for increases in employment and incomes through further development of the broader agrifood system, including agroprocessing, trade and transport, and food services.

Subsistence farming typically dominates agriculture during the earliest stages of development; as agricultural productivity rises; however, farmers start to supply surplus production to markets, thus creating job opportunities for workers in the nonfarm economy both within and outside of agrifood sectors (Haggblade, Hazell, and Dorosh 2007). Rising rural incomes generate demand for more diverse products, leading to more processing, packaging, transporting, trading, and other nonfarm activities. In the early stages of agricultural transformation, the agriculture sector serves as an engine of rural and national economic growth. Eventually, urbanization, the nonfarm economy, and nonagricultural incomes play more dominant roles in propelling agrifood system development, with urban and rural nonfarm consumers creating most of the demand for agricultural outputs via value chains connecting rural areas to towns and cities (Dorosh and Thurlow 2013). The exact nature of this transformation process varies across countries because of the diverse structure of their economies and the unique growth trajectories of their various agrifood and nonfood subsectors.

This paper describes the current and changing structure of PNG’s agrifood system (AFS) and evaluates the potential contribution of different value chains to accelerate agricultural transformation and inclusiveness. We start by offering a simple conceptual framework of the AFS and then compare PNG’s AFS to that of other countries at different stages of development. We go on to disaggregate PNG’s AFS across agricultural value chains, taking into consideration their different market structures and historical contribution to economic growth and transformation. Finally, we use a forward-looking economywide model to assess the diverse contributions that specific value chains can make to each of a set of broad development outcomes. We conclude by summarizing our main findings.

Papua New Guinea rural household survey (2023): Synopsis of selected results

From May to December 2023, IFPRI implemented the 2023 PNG Rural Household Survey which was designed to understand rural livelihoods and welfare across different areas of PNG (Schmidt et al., 2024). Given the rural nature of the survey sample, almost all surveyed households depend on their own-farm production (predominantly starchy roots and tubers) to meet daily caloric needs. On average, households reported utilizing about 1.6 hectares of land for agriculture cultivation at the time of the survey. The survey collected a detailed account of the quantity of food types consumed by the household in order to estimate the average caloric intake per adult equivalent. Comparing the estimated caloric intake reported by surveyed households, with a recommended calorie intake suggests that only 45 per cent of individuals in surveyed households meet the recommended daily caloric intake for a lightly active individual. The survey also collected anthropometry data for children under five years of age and found that 36 percent of surveyed children were stunted in their growth. The 2023 Rural Household Survey represents an important effort in collecting a wide breadth of information about rural livelihoods. However, greater investments of in-depth data collection and analysis should be undertaken to examine specific components of PNG household livelihood strategies.

Papua New Guinea food price bulletin: July 2024

This bulletin provides an overview of select food prices during the second quarter of 2024, from April to June. During this quarter, two rounds of data were collected per month across all markets, except for Goroka in April and Lae in May, where only one round of data was collected. The prices presented here are the monthly averages. The graphs in this bulletin show price changes within the second quarter and compare second quarter prices with the first quarter of 2024, between January and March. To access the complete food price dataset, please download it from our website.

Papua New Guinea Agriculture, Food and Nutrition Policy Support Program

In Papua New Guinea (PNG), more than 80 percent of the population depends on agriculture for their livelihoods, with a vast majority working as smallholder farmers. Recognizing the need to revitalize and transform its agriculture sector, PNG’s government has set ambitious growth targets for agricultural exports and domestic agricultural production. It considers strategic investment in agricultural research and food security fundamental to overall economic growth and structural transformation.

The Papua New Guinea Agriculture, Food and Nutrition Policy Support Program (PNG-AFNP), supported by the Australian Department of Foreign Affairs and Trade (DFAT) through the Australian High Commission (AHC) in Port Moresby, and the Australian Centre for International Agricultural Research (ACIAR), will support PNG’s forward-looking strategy for economic growth and transformation through data-driven policy analysis, capability development, and strategic partnerships to inform policy dialogue and investment opportunities.

IFPRI's country programs: Facilitating country-led food systems transformation

In most low- and middle-income countries, agrifood systems constitute a sizable share of economic activity and serve as a primary source of livelihoods, especially for poorer members of the population. As a result, national development strategies frequently put strong emphasis on the agrifood sector to achieve key goals, such as accelerating economic growth, reducing poverty, improving food and nutrition security, and confronting climate change. This emphasis was confirmed at the 2021 United Nations Food Systems Summit, where more than 100 countries committed to transforming their food systems to make them more productive, nutrition-focused, inclusive, resilient, and sustainable, and it was further reinforced by the Food and Agriculture Declaration at COP28. To achieve these desired transformations, governments require data and research based evidence to assess the situation, identify solutions, and prioritize actions. Governments are also increasingly interested in enhancing institutional capacity to support country-led development pathways.

2023 PNG Rural Household Survey Report

From May to December 2023, the International Food Policy Research Institute (IFPRI) implemented a rural household survey that collected detailed data on rural household food consumption and expenditures, agricultural production practices, employment profiles, child and mother 24-hour diet recall, and child anthropometry measurements in Papua New Guinea (PNG). The research team carried out the survey, which used location-based sampling, across five agroecological study areas, of which four of the areas were defined using elevation and rainfall variation. The five agroecological survey areas were seasonal highlands, nonseasonal highlands, seasonal lowlands, nonseasonal lowlands, and islands (the islands survey sample was not disaggregated by elevation or precipitation patterns). In identifying seasonal and nonseasonal survey areas, we adapted the rainfall seasonality categories established by Bourke and Harwood (2009), who evaluated the relative difference in rainfall between the wet and the dry season using resource mapping units defined by the PNG Resource Information System (PNGRIS). The areas of the country that experience large seasonal variation in rainfall (heavy to light, depending on the season) are classified as seasonal, whereas the areas that experience moderate to continuously heavy rainfall throughout the year are classified as nonseasonal (see Figure A1.1 in the appendix for the survey seasonality classification by area). In nonseasonal areas, agricultural growing conditions remain similar year-round, whereas seasonal rainfall areas have agricultural conditions that necessitate a variety of production strategies. Lowland and highland areas were defined using elevation data; areas 1,000 meters or more above sea level were classified as highlands, and those below 1,000 meters were classified as lowlands.

The survey collected data from 270 communities across 14 provinces, from a total of 2,699 households. It is important to note that the survey is not nationally representative. Rather, we chose a purposive sample using criteria that would enable analysts of the data to understand the key factors that interact within rural households and communities to create more resilient local food systems, more diversified employment profiles, and improved well-being. Generalizable relationships between variables that affect socioeconomic and other development outcomes in rural PNG communities should be seen consistently in both representative and unrepresentative survey samples.

CACCI country profile Papua New Guinea

Papua New Guinea ranks among the countries most at risk to natural disasters and climate change (World Bank, 2021). Increased exposure to natural hazards such as coastal and inland river flooding as well as landslides are likely to intensify in PNG, affecting agriculture production patterns and household livelihoods. In addition, the IPCC’s 5th Assessment Report suggests that Pacific coral reefs face a negative outlook under all climate change scenarios, whereby increased coral bleaching will have significant negative impacts on the health of coastal fisheries in PNG (Nurse et al., 2014).