PNG on brink of AIDS epidemic

The impact of an AIDS epidemic will hit PNG's poorest people the hardest

PORT MORESBY, Papua New Guinea (CNN) -- Papua New Guinea is on the brink of an HIV/AIDS epidemic that could reduce its potential workforce by nearly 40 percent over the next 18 years.

A report by the Center for International Economics warns the social and economic consequences of such an epidemic should be of great concern and steps must be taken quickly to prevent a disaster.

While the current number of people currently with HIV is low -- at between 10,000 to 15,000 or less than 1 percent of the population -- the incidence of high risk behavior suggests the disease is poised to spread rapidly.

PNG, which has a population of 4.3 million people, had similar behavior patterns to other countries which had experienced serious HIV/AIDS epidemics such as South Africa and Zimbabwe.

The report -- which was commissioned by the Australian government's overseas' aid arm AusAID -- says poorer people and the working population will be most hard hit.

EXTRA INFORMATION AIDS/HIV in Papua New Guinea FULL REPORT

Using three models of the spread of HIV/AIDS, even the lowest case scenario suggests PNG could lose 13 percent of its working population by 2020.

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The impact on the PNG economy would also be profound, the report says, with real gross domestic product tipped to fall by as much as 7.5 percent.

The nation's health, education and infrastructure sectors would also be considerably affected.

The report warns that threat to the PNG government and the struggling nation's development partners, such as Australia, was significant and efforts to prevent a widespread epidemic were essential.

Australia is one of PNG's major donors of aid, last year providing around $190 million in assistance. This represents about one-fifth of Australia's entire overseas aid budget.

PNG, while lies directly north of Australia, was administered by Australia until gaining independence in 1975.

Poor management

The PNG economy, which is heavily reliant on mineral, forestry and agricultural exports, can ill-afford any further pressure on it triggered by an AIDS epidemic.

Despite often strong export earnings, the economy has not been well managed and there is often pressure on social services and infrastructure.

For example, earlier this week ambulance services in the capital Port Moresby were suspended because of a lack of petrol.

There has also been a series of mutinies among the nation's armed forces due to planned cuts in the military due to national budgetary restraints.