This growth is largely driven by the recovery of resource extraction in Papua New Guinea, the subregion’s largest economy. Stable visitor arrivals in most tourism-dependent economies and stimulus from public infrastructure projects are also  driving growth. However, a wide range of factors—including labor shortages, reduced fiscal space, and exposure to climate change and disaster risk—pose downside risks.

The Pacific Economic Monitor is ADB’s biannual review of economic developments and policy issues in 14 developing Pacific countries, spotlighting infrastructure, climate resilience, and public financial management within the unique Pacific context.