The International Monetary Fund reached a staff-level agreement with Papua New Guinea on Tuesday to release up to $189 million in funding, pending formal approval by the IMF's executive board.
The accord concludes final reviews of Papua New Guinea's Extended Credit Facility, Extended Fund Facility, and Resilience and Sustainability Facility arrangements. Upon board approval, Papua New Guinea would receive approximately $82 million immediately, with up to $107 million designated for climate financing.
These disbursements would bring total IMF support to Papua New Guinea to about $1.19 billion.
The IMF projects real gross domestic product growth for Papua New Guinea to slow to 3.1 percent in 2026, down from 6.2 percent in 2025. The IMF cited a leveling off of liquefied natural gas output, adverse effects from El Nino weather patterns on farming and mining, and increased import costs from the Middle East conflict.
Headline inflation is expected to reach 4.8 percent.
Papua New Guinea's government met all but one quantitative performance criterion and all indicative targets for the end of June 2026, though it missed its fiscal deficit target in the first half of the year. The government passed a supplementary budget in September and aims to keep the 2026 fiscal deficit at 1.6 billion Papua New Guinea kina, roughly $345 million.
