With poverty, crime, poor healthcare and a rampant gang culture, Port Moresby consistently comes bottom of the unit's "hardship" league table, meaning it is regarded as the worst place to live among 130 world capitals. Baghdad is not on the list.
According to the unit, most aspects of daily life in Moresby are problematic.
With a relatively small population of 250,000, it is a place where murder rates are high, thanks mainly to the raskol gangs that control large areas of the city.
Tales of their exploits are legion; from bank robberies with M-16 assault rifles, to car holdups by mobs armed with machetes.
Rape cases are even worse: in one widely reported incident last year, an injured nurse was dragged away from a car crash to be gang-raped.
Visitors to Port Moresby are advised not to go out after sunset, and to avoid walking the streets in most areas even during the day.
The houses of the wealthy squat behind walls tipped with razor-wire and gates watched by security guards.
The precautions are necessary because a survey of international crime by the UK Home Office shows that the murder rate there is three times that of Moscow, and 23 times that of London.
The rates for robberies and rapes are just as dire.
But the raskols say much of the violence is meted out by the police, and that they are provoked into retaliation.
The base of Moresby's Bomai gang can be found up a dark sidestreet in the suburb of Four Mile. At the entrance to their squatter settlement a man is on guard, armed with a walkie-talkie.
"The police we know are very dangerous. They come in to the settlement and raid the people's food and property and beers," says Koiva, one of the leaders of the gang.
He has a pattern of welts on his head where he says he was beaten by a police officer with a glass bottle to extract a confession.
Another gang member, Stephen, shows two dark scars on his legs which he says were caused when he was shot in police custody.
Most people living in Port Moresby show little sympathy for the Bomai, whose raids on businesses and residential compounds have made them infamous.
"Bloody raskols. Shoot first and ask questions later, that's what they [the police] should do," says an Australian expatriate.
Often, that is precisely what happens.
"I think the government are happy every time the police shoot a young man but we have thousands more youths on the streets," says Peter Gola, a former raskol working at City Mission, a charity that helps the city's street children.
Most raskols argue that their crimes are driven by the crushing poverty of life.
"We never mean to kill people," says Koiva. "We're just trying to scare them and get what we want to get."
Papua New Guinea has no welfare state, so in rural areas family and clan networks have kept people in food and lodging. That system has broken down in the capital, which sits in an arid part of the country where unemployment rates are estimated to be between 60 percent and 90 percent.
A kilo of rice here costs four kina -- about US$1 -- and a tin of fish is three kina, but this is beyond the means of many families.
Most raskols say they get into crime when their parents send them out to make money. Pressured to generate an income, they turn to violence. An armed robbery can easily net more than 100,000 kina (US$20,000).
"When that happens, we live like kings," says Harris, another Bomai member. "If you're lucky, you eat something good. Maybe chicken."
But there is some hope for change. Twenty minutes' drive from Moresby, City Mission's New Life farm has offered an alternative to the violence for between 5,000 and 6,000 street children since it opened 11 years ago.
The regime is strict: smoking and drinking are forbidden and there is a strong religious flavor to the instruction.
But the founder, Larry George, says the structure and respect of their new lives can work wonders.
"Most of them aren't bad kids," says George. "It's mainly just poverty that's driving the crime. People can read in the papers about the government stealing millions of kina and get really frustrated."
Many of the children, he says, end up as security guards, exchanging fire with the raskols who were once their peers.
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