The government in Papua New Guinea has handed down a big spending budget with a focus on rebuilding the country's crumbling infrastructure.At just under six billion dollars (K13 billion) it's PNG's biggest ever budget and the government is going to have to borrow more than a billion dollars to fund it.
The Treasurer Don Polye told parliament the focus is infrastructure, education, health and law and order.
Some of the big ticket items include 200 million dollars to start rebuilding the country's main economic artery, the Highlands Highway, and 140 million dollars to comprehensively restore the Port Moresby General Hospital.
The budget predicts growth will fall from 9 per cent this year to 4 per cent next year.
Inflation is expected to climb to 8 per cent.
Director of PNG's Institute of National Affairs, Paul Barker has told Radio Australia's Pacific Beat that although he considers the budget conservative, the government is counting on the situation in Asia improving.
"With a decline in the growth of some of the major Asian economies - like almost recession in India again, Chinese growth back to 7 per cent, this is resulting in lower commodity prices and we're dependent on those commodity prices for getting us the level of revenue that are expected particularly from the mining sector and through taxes," he said.
He said infrastructure, education, health and law and order will take priority -- and insisted communities will benefit.
"What was concerning me was that there doesn't seem to be anything, as far as I can see so far, for building up the capacity building at the local level - the district, local government level- there seems to be an indication that this would be left to the development partners," he said.