27 Feb 2006

Calls for Fiji government to reduce national debt levels in regards to consumption

4:46 pm on 27 February 2006

The Fiji government is being called on to reduce the level of national debt which is being labelled as unsustainable.

The head of the School of Economics at the University of the South Pacific, Dr Biman Prasad, says it's projected this year to amount to 1.5 billion U.S. dollars which is 53 percent of the country's gross domestic product.

And, he says a high percentage of it is down to government borrowing.

Dr Prasad says borrowing isn't necessarily bad but too much of government debt is earmarked for consumption expenditure.

"It means salaries for public servants, it means money for travel, it means money for undertaking activities, training. And, a lot of these expenses could be contained and the government could look at real reduction in these kinds of expenditures and direct part of those towards capital expenditures."

Dr Prasad says this includes funds for infrastructure such as roading, water, electricity, which are in a poor stated.

The Fiji government says it is looking at ways to reduce operating costs and increase capital expenditure.