The European Commissioner for Development and Humanitarian Aid says the EU will not provide budget support to Papua New Guinea because its financial management is a concern and corruption is a problem.
Poul Nielson has just left PNG after a two day stay in Port Moresby.
Mr Nielson says the situation doesn't allow for budget support, but he says the EUu wants to move into doing sector program-based support.
Mr Nielson says the handling of money is not really good enough for PNG to qualify for budget support.
He says one challenge is to get to a situation where the public adminstration is more predictable and has more quality to it.
The EU has spent 442-million US dollars in PNG since 1978 and already has over 114-million dollars set aside for the country between now and 2007.
