An Australian report says an AIDS epidemic could decimate up to 40 percent of Papua New Guinea's working population within 20 years and threaten the future of the government. The study for the Australian Government points toward a looming health crisis, a breakdown of law and order and an end to foreign investment.

The report by the Australian government's aid agency AusAid paints a bleak picture for the future of Papua New Guinea.

As many as 15,000 people there are now HIV positive and the number of infections is rising by up to 30 percent every year. AIDS-related diseases are now the major cause of death at the general hospital in the capital, Port Moresby.

The AusAid study concludes that the situation could get worse in the next couple of decades. It predicts that up to 125,000 people in Papua New Guinea could die by the year 2020.

The consequences for the Pacific island nation could, the report warns, be crippling. Without sufficiently qualified workers, the government might not be able to function. Plus there is the huge pressure the epidemic could have on health services.

The government in Port Moresby now has a National Plan for HIV Prevention. It aims to provide education, counseling and improved medical care. It also is developing a more efficient way of tracking the spread of the virus. The country has the highest rate of sexually transmitted diseases in the South Pacific region.

In Papua New Guinea, HIV, the virus that causes AIDS, is largely a heterosexual problem. There is a high incidence of unprotected sex and one in every six prostitutes is thought to be HIV positive. Some commentators have blamed the spread of infection on the breakdown of traditional village life.

Australia, PNG's former colonial master, is spending $30 million as part of a five-year HIV and AIDS program. It will build and equip clinics to treat sexually transmitted infections across the country.