K9bn debt too much for PNG, ex-treasurer says

 FORMER Treasurer Don Polye says Papua New Guinea’s current debt of between K8 billion and K9 billion is too much.
He said that yesterday when replying to a question from a caller on FM100’s Talkback Show on how much debt the country had after taking into account the K3 billion to buy shares in Oil Search.
“Our total debt is between K8 billion and K9 billion,” Polye said.
“This is too much debt for us. Debts that were outstanding for many years were brought forward to this year, debts totaling K6 billion.The total national debt is about K8 billion.
“Add this to our GDP and our aggregate wealth is about K33 billion.
“That’s why when we borrow more money, our ability to pay back loans will be affected and this will undermine our revenue.
“Borrowing more and more money will not help. This will affect our development budget.
“Money for infrastructure development will be affected because this is going towards paying those
loans.
“For instance, now when we borrow this K3 billion to buy 10.1% share of Oil Search, we will have to start repaying within the next six months.
“Our development budget is only about K5 billion. With this K3 billion loan, that means that almost three-quarters of this development budget of PNG is gone.
“This is how serious the debt levels are.
“Starting this year, symptoms of this problem will start to show clearly, because debt levels are too high and this is affecting development, government commitments.”