Govt looks to Aust for help

TREASURER Ian Ling-Stuckey says the budget deficit should be financed through assistance from countries such as Australia and through domestic market financing options.
He said project financing options suggested by the Opposition, the China Development Bank loan and the sale of the Maseratis “will not help finance the country’s extra deficit”.
Shadow Treasurer Joseph Lelang had suggested last week that Ling-Stuckey should come up with an economic recovery package to lift the economy out of the mess it is in.
Ling-Stuckey said options such as project financing, budget financing to sell the Maseratis and to secure a China Development Bank loan of K960 million “will not help fund the deficit because it is for project financing only and not for funding deficits”.
“We will continue to use the ADB and World Bank budget support loans started by the former government,” he said.
“We will seek out other budget support assistance from other countries if on the right terms. And we are encouraged by current negotiations with Australia. We will use the domestic market to fund the remainder of this year’s deficit.”
He said the budget deficit was K4.6 billion in 2019 alone and the public debt was more than K33 billion or 41.3 percent of the Gross Domestic Product.
Ling-Stuckey is expected to announce massive cuts in costs to the tune of K1,482 million in the Supplementary Budget he will table in Parliament tomorrow.
“There will be further cuts in spending in the 2020 Budget and 2021 Budget.
“There will be further action on raising revenues by (dealing with) tax evasions and getting a proper return from our resources. There will be further actions to lift growth.
“(But) it is just not possible to make cuts big enough to get rid of all of this gap before the end of 2019.
“This means that there will remain the need for K1,557 million more deficit financing this year.”