Government debt

The current outstanding debt is comprised of K25.2 Billion from domestic sources and K22.9 Billion from external sources.

According to the Bank of PNG Central Bank Quarterly Economic Bulletin for the month of December, the total Government deposits at depository corporations increased by K1.3 Billion to K5.2 Billion, mainly between November and December of 2021. 
 
This increase reflected drawdowns of external budget support as well as financing from domestic sources.

Public debt is sustainable when the government is able to meet all of the payment obligations without recourse to exceptional financial assistance or face the prospects of default. 

NRI Discussion Paper No.195 entitled “Fiscal Policy for Sustainable Debt in PNG” by Professor Satish Chand and Dr. Osborne Sanida that was released today to provide answers to the specific question on the size of the primary fiscal balance (i.e. revenue minus expenditure, exclusive of interest payments).

Central Bank Governor in his September Quarterly Monthly Bulletin revealed that the domestic loans increased while external loans decreased.

He said the increase in domestic debt was largely attributed to net new issuance of Government securities, while the decrease in external debt reflected the loan repayments.

Bakani further added that the total amount of Government deposits at the depository corporations increased by K146.2 million to K2,652.7 million in September 2016, compared to June 2016.