Posted By Staff Reporter
THE Covid-19 pandemic is taking its toll on the economy which is continuing to contract six weeks into the lockdown, with further negative growth predicted, Papua New Guinea Treasurer Ian Ling-Stuckey says. He said according to a commissioned research into the impact of the lockdown, the Gross Domestic Product forecast at 2 per cent in the 2020 national budget would drop to minus 1.5 per cent (-1.5 pc). The research further revealed that the possible economic impact after a two-month shutdown would see the Gross Domestic Product growth rate drop to minus 3.8 per cent (-3.8 pc), and a further drop to minus 6.2 per cent (-6.2 pc) after a three-month shutdown.
“The economic research results are very worrying,” he said. “This is not intended to scare or talk down the economy in any way, but to highlight the challenges. “Poverty is a risk factor in dying early. “A major drop in GDP will lead to more poverty and more premature deaths.” A recession occurs when there are two or more consecutive periods of negative economic growth, meaning GDP growth contracts during a recession. The lockdown began after the state of emergency was declared on March 22. Ling-Stuckey said the numbers were “distressing, particularly when four out of every 10 people in PNG already lived in poverty, according to international measures”. He said Covid-19 was deadly and there was uncertainty about the death rate. “PNG is fortunate in not having a single death yet from this silent killer,” he said. He said the Government was trying to “strike the right balance between protecting our health and protecting our livelihoods”. “If we drop all lockdowns, and go back to business as usual, tens of thousands of people in PNG will likely die due to Covid-19,” Ling-Stuckey said. “However, if we keep very tight lockdowns in place, then the increase in poverty will also likely rise which mean tens of thousands of people in Papua New Guinean will die due to loss of livelihoods.” Meanwhile Ling-Stuckey said he would announce this week Government’s support. “We will not be able to meet all expectations. “We are working and praying to get the health and livelihoods balances correct,” he said. The National/PNGfacts/#PNGEconomyWatch next : Why Is The PNG Economy Important? Comments are closed.
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