Foreign aid and the financing of service delivery in Papua New Guinea

Date

2009

Authors

Batten, Aaron

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Journal ISSN

Volume Title

Publisher

Crawford School of Economics and Government, The Australian National University

Abstract

How much foreign aid given to PNG has stayed within the sectors to which it has been allocated and how much has it allowed the PNG Government to free up its own resources for other spending priorities? This paper measures the extent to which donor finance has contributed to higher rates of spending in three key development sectors of the PNG economy—health, education and infrastructure between 1974 and 2008. Results show that high rates of fungibility have occurred within PNG during this time. The PNG Government has placed the least priority on additional rates of health spending and most priority on additional infrastructure spending, although all sectors have increased by only a fraction of the amount of aid given. The results also compare the impact of budget support vis-à-vis project and program aid to induce higher rates of spending in each of these sectors. A number of policy implications follow.

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Citation

Batten, A. (2009). Foreign aid and the financing of service delivery in Papua New Guinea. International and Development Economics Working Paper 09-05. Canberra, ACT: Crawford School of Economics and Government, The Australian National University.

Source

Type

Working/Technical Paper

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Entity type

Access Statement

Open Access
Open Access

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