This session provides an update on the state of Papua New Guinea’s economy and service delivery capacity. It will examine Papua New Guinea’s recent economic performance, and macroeconomic and structural policy developments. These broader economic considerations are complimented by a critical analysis of the challenges of Papua New Guinea’s work permit system. While this system is relatively balanced on paper, a lack of monitoring and enforcement and the granting of many exemptions, particularly in regards to language requirements, have led to a situation where Papua New Guinean workers are arguably disadvantaged. The session then examines the capacity of the state to deliver services for its citizens through an examination of the impacts of the government’s current education policy. It highlights the political, social and economic challenges facing schools and administrators in implementing sometimes contradictory, and multi-scalar, education policies. This session will take stock of the economic and policy challenges facing Papua New Guinea and what these mean for development into the future.