But the widespread perception then was that the decline was caused by the Federal Reserve, which had clamped down on the money supply to end out-of-control inflation.

Widespread concern about an oversupply of shares in the mainland equity market has been the main reason behind the 30 per cent decline in the benchmark Shanghai composite since its peak last October.

"Such a decline is likely to be widespread as the species is under similar pressures elsewhere in Papua New Guinea," she added.