Papua New Guinea Country Summary

FATF Status

Papua New Guinea is on the FATF List of Countries that have been identified as having strategic AML deficiencies.

Compliance with FATF Recommendations

The last Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Papua New Guinea was undertaken in 2024. According to that Evaluation, Papua New Guinea was deemed Compliant for 4 and Largely Compliant for 13 of the FATF 40 Recommendations. It was deemed Highly Effective for 0 and Substantially Effective for 0 of the Effectiveness ratings.

Papua New Guinea faces significant challenges related to crime and corruption, which impede governance and economic development. The prevalence of organized crime, including human trafficking, arms trafficking, and environmental crimes, is exacerbated by widespread corruption among public officials and limited law enforcement resources, highlighting the need for comprehensive legal reforms and enhanced institutional capacity.

Papua New Guinea (PNG) stands as the largest economy in the Pacific Islands, presenting significant trade and investment opportunities, particularly in the petroleum, mining, agriculture, and fisheries sectors. The government projects an economic growth rate of 4.3% alongside an inflation rate of 3.2%, bolstered by commitments to stability through funding in law and justice and security assistance from Australia. Despite a notable decline in foreign direct investment (FDI) in 2023, the government is actively promoting initiatives to enhance the investment climate, including regulatory reforms, the establishment of Special Economic Zones, and efforts to attract institutional investors, all aimed at creating a competitive, export-driven economy supported by a robust domestic market.