Papua New Guinea Kina: Grasping the Currency, Its History, and Economic Impact

The Papua New Guinea kina (PGK), established in 1975, serves as the nation’s official currency. Denoted as “K,” it replaced the Australian dollar and is a vital element in the country’s economic landscape.

The kina, divided into 100 toea, finds its roots in April 1975 when it took over from the Australian dollar. Initially, six coins were minted, including smaller denominations of 1, 2, 5, 10, and 20 toea. In 2007, the 1 and 2 toea coins were discontinued. Banknotes were introduced in 1975, with larger denominations like the 20, 50, and 100 kina notes appearing in subsequent years. The currency’s name, “kina,” is derived from a traditional shell used for local commerce.

The kina features symbols reflecting Papua New Guinea’s unique fauna and cultural artifacts. Notably, the 50-kina bill showcases the Parliament building and a portrait of Prime Minister Michael Somare.

Papua New Guinea’s underdeveloped economy is attributed to its challenging terrain, making infrastructure development expensive. Subsistence agriculture plays a pivotal role, with a significant portion of the population relying on it for sustenance.

The PGK operates as a free-floating currency, its value influenced by supply and demand. Over the past decade, it has depreciated against the U.S. dollar, affecting Papua New Guinea’s inflation rate and per-capita GDP. The country’s main exports include gold, copper, coffee, oil, and liquefied natural gas (LNG), contributing to approximately 20% of the GDP. Despite rich natural resources, a substantial portion of the population faces economic challenges.

The name “kina” is derived from a type of shell that was traditionally used for local commerce in Papua New Guinea.

The kina was introduced in April 1975, replacing the Australian dollar as the official currency of Papua New Guinea.