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MELBOURNE, Australia (Radio Australia, Dec. 1) – A new study released by Australia's Foreign Minister, Alexander Downer, points to the danger of economic contraction in Papua New Guinea over the next decade.

PNG is at a crossroad, according to the report by the Economic Analytical Unit in Australia's Department of Foreign Affairs and Trade. It notes that PNG's economy was contracting most of the time from 1995 to 2002.

Since 2003, the economy has been recovering and major resource projects are on track, such as piping gas from PNG to Queensland.

But resource development is predicted to add only one percent growth a year to Papua New Guinea's economy over the next 10 years.

The Foreign Affairs report warns this growth will be uneven and not match population increase.

Unless other economic changes are made, it says, the income of the average Papua New Guinean will continue to decline.

December 2, 2004

Radio Australia:


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