Rethinking What “Resource-Rich” Really Means for Papua New Guinea
Papua New Guinea is frequently described as a “resource-rich” country. This label appears routinely across government documents, media articles, and statements from international organizations. It even forms part of the national narrative. Prime Minister James Marape, speaking at the beginning of 2025, emphasized this identity, describing PNG as “uniquely positioned as a resource-rich nation” situated near major global markets like Southeast Asia, China, and India.
At first glance, this characterization seems justified. PNG boasts considerable natural resources—gold, copper, oil, and gas—which together make up about 27% of its gross domestic product (GDP). This makes PNG one of the most resource-intensive economies in the world, comparable in this respect to oil giants like Saudi Arabia. But while the numbers reflect a high reliance on resource extraction, they don’t necessarily translate into high national wealth or broad-based prosperity. This is where the label “resource-rich” becomes problematic—and potentially misleading.
What does it truly mean for a country to be resource-rich? Is it about how much raw material is in the ground? The wealth generated? The benefits to ordinary citizens? The phrase is vague and slippery, and this vagueness can lead to unrealistic expectations. For some, “resource-rich” conjures images of gleaming cities, robust infrastructure, and strong social services. But for others, especially within PNG, daily realities remain defined by poor service delivery, limited economic opportunities, and underdeveloped infrastructure.
To clarify what being “resource-rich” means, it’s helpful to think in two ways. The first is absolute abundance: the total quantity of resources a country possesses, allowing it to influence global commodity markets. The second is per-capita resource wealth: the amount of natural wealth available per person, which more directly affects the standard of living—assuming fair distribution and sound management.
When looking at absolute abundance, PNG fares moderately well. According to World Bank data on total resource rents (the economic value derived from natural resources after production costs), PNG ranks 41st globally. This sounds impressive until you factor in that many major resource-rich nations (like Kuwait or Venezuela) aren’t included due to missing data, and PNG’s relatively small population and economy diminish its global market influence.
More relevant is PNG’s per-capita resource wealth, which tells a different story. On this metric, PNG ranks 36th globally, with an estimated US$1,089 (approximately K4,508) in annual resource rents per person. That breaks down to about US$2.75 (K11) per day. While enough, in theory, to lift each person above the international poverty line, it is far from the transformative wealth implied by “vast riches.” Even if these rents doubled, PNG would merely reach the level of Timor-Leste—another country still facing serious development hurdles.
Crucially, not all of this wealth reaches ordinary citizens. Much of it is captured by multinational companies, a small group of landowners, and the government. For many Papua New Guineans, the benefits are limited or indirect. Despite PNG’s high resource intensity, the returns to the state and broader economy have been underwhelming—especially when compared to similarly endowed countries.
So why does PNG still carry the “resource-rich” label? Statistically, PNG’s per-capita rents are above the global median (US$238) but below the average (US$1,370). This distinction matters: a handful of countries with enormous resource wealth skew the global average upwards, while the median gives a better sense of the typical experience. Compared to most countries, PNG does have more natural resource wealth—but not enough to guarantee national prosperity.
The problem is not just statistical—it’s political and economic. The label “resource-rich” can shape dangerous assumptions. It suggests that prosperity is inevitable, that the country simply needs to unlock or accelerate resource projects to achieve development. This belief fuels inflated political promises, delays structural reforms, and distracts from the harder, long-term work of building a diversified economy.
Indeed, some government spending decisions appear to reflect an overestimation of the nation’s wealth. A striking example is the infamous proposal for a Formula One track—a project seemingly inspired by comparisons with ultra-wealthy oil states like Qatar or Saudi Arabia. But those comparisons are deeply flawed. PNG may resemble them in resource dependence, but not in actual wealth or governance capacity.
This kind of flawed reasoning is at the heart of what economists call the “resource curse”—a paradox where resource-rich countries often suffer from poor governance, conflict, and underdevelopment. PNG is not immune to these patterns. As Figure 3 (referenced in the original analysis) shows, many of the most resource-intensive economies in the world provide neither high nor middle-class living standards to their populations.
Recognizing these limitations does not mean PNG should abandon the resource sector. Extractive industries will continue to play a vital role in the economy. But they should not dominate the national development strategy or public imagination. The phrase “resource-rich,” when used uncritically, reinforces dependency and distorts policy priorities.
A more balanced vision is needed—one that acknowledges PNG’s resource wealth but focuses on the broader foundations of prosperity: quality education, health care, infrastructure, good governance, and human capital development. This is not just a more realistic path; it is a more hopeful one.
Interestingly, at the bottom of the World Bank’s resource wealth rankings is Singapore—an economic powerhouse with almost no natural resources. Singapore built its success on smart policy, strategic location, and investment in people. PNG could do the same, tailored to its unique context.
In sum, Papua New Guinea’s label as a “resource-rich” country may hold some truth, but it is incomplete and potentially misleading. It is time to retire the myth of imminent riches and focus instead on creating inclusive and sustainable growth. That will require vision, discipline, and a willingness to look beyond the mines and oil fields—to the people who will ultimately shape the country’s future.
Source: Abstracted from an article by Rohan Fox, an independent economist and development professional. He has worked with the Department of Foreign Affairs and Trade, Development Policy Centre, and as a Lecturer at the University of Papua New Guinea.
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