Papua New Guinea Political Stability and Absence of Violenc...

Published 2026-10-09 · 24Peaks Research

Papua New Guinea's score on the Political Stability and Absence of Violence/Terrorism indicator is among the weakest in the Asia-Pacific region, typically sitting in the bottom quartile of global rankings in the latest available data. The indicator, published annually by the World Bank as part of its Worldwide Governance Indicators (WGI) project, measures perceptions of the likelihood that a government will be destabilized or overthrown by unconstitutional or violent means. For investors, it functions as a rough proxy for political risk and social unrest, both of which feed directly into sovereign spreads, insurance premiums and equity discount rates.

What the Indicator Actually Measures

Political Stability and Absence of Violence/Terrorism is one of six worldwide governance dimensions tracked by the World Bank. It captures perceptions, not hard events, and is built from a basket of survey and expert-assessment sources compiled by think tanks, risk consultancies, multilateral agencies and NGOs.

The composite is normalized onto a scale of roughly -2.5 to +2.5, with higher values indicating stronger stability. The World Bank also publishes a percentile rank from 0 to 100, showing where a country sits relative to every other country measured. A percentile rank of 20, for instance, means the country scores above only 20 percent of countries globally.

Crucially, the indicator covers two related but distinct risks. The first is unconstitutional change of government — coups, armed rebellion, or forced removal of elected leaders. The second is politically motivated violence and terrorism, including riots, communal conflict and insurgent activity. For a country like Papua New Guinea, both dimensions matter: the country has a long history of electoral violence, tribal conflict and unrest in urban centres, even as it has avoided a successful military coup since independence in 1975.

Because scores are perception-based, they can move on media coverage and expert sentiment as much as on measurable events. That makes them useful as a directional signal but unreliable as a precise, real-time measure of on-the-ground conditions.

Why Investors Care

Political stability is priced into almost every cross-border investment decision. It shapes the sovereign risk premium, the cost of political-risk insurance, the willingness of multinationals to commit long-dated capital, and the discount rate applied to resource projects that may take a decade or more to pay back.

For Papua New Guinea, the stakes are unusually high. The economy is dominated by large extractive projects — gold, copper, liquefied natural gas — that require long investment horizons, stable fiscal terms and reliable security for personnel and infrastructure. A deterioration in political stability can translate quickly into project delays, renegotiated contracts, or higher security costs.

The indicator also serves as a screen for portfolio investors. Many institutional mandates exclude or underweight countries below certain governance thresholds, and the World Bank's stability percentile is one of the most widely used cut-offs. A weak score can therefore restrict a country's access to a whole class of foreign capital, independent of its underlying growth prospects.

Finally, stability scores correlate with other governance dimensions — rule of law, control of corruption, government effectiveness — which tend to move together. When political stability erodes, it often signals broader institutional stress that affects contract enforcement and property rights.

Recent Trends by Region

Global political stability has generally weakened over the past decade, dragged down by conflict in the Middle East, the Sahel, Eastern Europe and parts of South Asia. The distribution is highly uneven: a small group of high-income and stable middle-income countries cluster near the top of the percentile ranking, while fragile and conflict-affected states occupy the bottom.

In the Asia-Pacific, the picture is mixed. Comparatively strong scores are recorded by Australia, New Zealand, Japan, Singapore and South Korea, all of which sit in the top quartile globally. The Pacific island states form a middle band: small populations and distance from major conflict zones help, but electoral volatility, resource disputes and climate-related stress weigh on scores.

Papua New Guinea sits below much of that Pacific band. Its percentile rank has hovered in the low band of the global distribution in recent years, reflecting recurring election-related unrest, lingering tensions in the Highlands, and periodic violence in urban centres such as Port Moresby and Lae. As of the latest available year, the country remains classified among the weaker performers in the region. Exact values and the full historical series are hosted on the 24Peaks data platform, where the indicator can be charted by year and compared across economies.

Neighbouring Indonesia, by contrast, has improved markedly since the late 1990s, moving from deep instability during the Suharto transition to a mid-to-upper percentile position over the past decade.

Comparison Examples

It helps to place Papua New Guinea against a few peers and benchmarks to see where it stands. The figures below are illustrative of the tier each country occupies; for precise latest values and vintage years, consult the live series on 24Peaks.

The comparison illustrates two useful lessons. First, stability is not fixed: Fiji and Indonesia have both moved materially over the past two decades. Second, geography and income are not destiny — Fiji, a small Pacific economy, has at times scored well above much larger and wealthier countries during calm political periods.

Limitations to Keep in Mind

The indicator is a perception index, not an event count. It does not directly tally coup attempts, riot deaths or terrorist incidents; it aggregates what experts and survey respondents believe about risk. That means it can lag reality, react to headlines, and carry the biases of its underlying sources.

Coverage of small, low-income countries like Papua New Guinea is also thinner than for large economies, so the margin of error around the score is wider. A one- or two-point shift in percentile rank should not be over-interpreted as a real change in conditions on the ground.

Investors should treat the score as one input among many — alongside sovereign credit ratings, security assessments, contract terms and local operating experience — rather than as a standalone verdict on country risk.

FAQ

What does a low Political Stability score mean for Papua New Guinea?

It signals that experts and surveys perceive an elevated likelihood of politically motivated instability or violence. That perception can raise the cost of capital and political-risk insurance for investors. It does not mean a coup or collapse is imminent.

Which organization publishes this indicator?

The World Bank publishes it through the Worldwide Governance Indicators, a research dataset updated annually. It draws on dozens of underlying sources rather than a single survey. Scores are expressed on a -2.5 to +2.5 scale and as a 0-100 percentile rank.

How does Papua New Guinea compare with its neighbours?

It typically scores below Indonesia, Fiji and Australia, placing it among the weaker performers in the Asia-Pacific. Exact rankings shift year to year depending on the vintage of the data. The latest comparison is available on the 24Peaks platform.

Does the indicator predict coups or unrest?

No — it measures perceptions of risk, not future events. It is a useful directional signal but has limited predictive power on its own. Investors should pair it with event-based data and on-the-ground intelligence.

Why do small countries have less reliable scores?

Because fewer surveys and expert assessments cover them, the underlying sample is thinner and more volatile. Small states like Papua New Guinea therefore carry wider confidence intervals around their scores. This makes year-to-year changes less meaningful than long-run trends.

Political stability is one of the most influential — and most misunderstood — inputs in emerging-market investing, and Papua New Guinea's position on the spectrum is worth tracking closely over time. To chart this indicator, compare it across countries and see the latest available year in full, open the indicator on the 24Peaks workbench.