THE Bank South Pacific (BSP) says Papua New Guinea’s economy remained resilient during the June quarter of 2026, despite growing global uncertainties, and is expected to continue growing at a moderate pace in the months ahead.
The bank made the assessment in its June Quarter 2026 Economic and Market Pulse, released today (20/07/26), which provides an overview of economic conditions in Papua New Guinea and across the South Pacific.
In the report, BSP Group Chief Executive Officer Mark Robinson said the global economy was entering a period of slower growth as the conflict in the Middle East continued to put pressure on energy prices and increase uncertainty for businesses and investors.
Despite these challenges, Mr Robinson said Papua New Guinea had managed to maintain steady economic performance during the June quarter.
He said government measures to stabilise fuel prices had helped cushion the country from rising global energy costs, while high international prices for major exports, including liquefied natural gas (LNG), gold and copper, continued to support the economy.
Mr Robinson also said stable foreign exchange conditions and a strong agricultural sector had contributed to the country’s economic resilience.
However, he warned that the possible return of El Niño could disrupt agricultural production and exports, while also pushing up food prices.
“Despite these challenges, we remain cautiously optimistic about PNG’s economic outlook in the third quarter, with positive sentiment surrounding the proposed US$12 billion Papua LNG project,” Mr Robinson said.
BSP expects the country’s economy to continue expanding during the third quarter, although at a slower pace as global and domestic pressures affect demand and inflation.
The report also notes that while economies across the South Pacific have remained resilient, higher energy prices, weaker global demand, tighter financial conditions and climate-related risks are expected to slow economic activity and reduce tourist arrivals throughout the region.
The June Quarter 2026 Economic and Market Pulse also
includes an analysis of Papua New Guinea’s foreign exchange market and the performance of the kina by BSP Group General Manager for Treasury and Markets, Rohan George, together with a detailed economic review by BSP Chief Economist Andrew Wu.