26 Apr 2010

French Polynesia president warns of deficit amid revenue slump

10:18 am on 26 April 2010

French Polynesia's president, Gaston Tong Sang, says if revenue continues to decline, the territory will have a deficit of more than 22 million US dollars by the end of the year.

Mr Tong Sang says he intends to cut the deficit by lowering expenditure in the public sector.

He says the pay of public servants this month and in the months to come is assured.

This comes after a credit downgrade by the agency Standard and Poors to BBB-, with the agency describing the situation as an unprecedented economic crisis in part due to the political instability

The opposition has blamed Mr Tong Sang for the slump which has seen the economy shrink and jobs being lost while remaining dependent on fund transfers from Paris.

Employers say they cannot keep their arms crossed awaiting the return of stability with what they call the inadmissible alliances.