Papua New Guinea: policy for the informal economy, 2011

Why should PNG encourage the growth of its informal economy when most governments are trying to reduce the size of their ‘informal’ sectors? In PNG, however, the informal economy is too small, not too large. It is still too limited in scale, scope and contribution to national output. Further growth is a necessary step towards the emergence of a class of vigorous national entrepreneurs in the small and medium enterprise (SME) sector, which is still pitifully underdeveloped. And the informal economy is still too weak to perform the task of transmitting the developmental impulses flowing from mining and gas revenues. This is a major policy challenge, if equitable sharing of the benefits of the resource boom is to occur.