Morauta tells PNG PM no quick fixes for economy

7:25 pm on 21 April 2016

A former Papua New Guinea prime minister says the government's push to borrow from the International Finance Corporation is a smoke-screen.

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Photo: RNZI / Koroi Hawkins

Sir Mekere Morauta, who is also an economist and a former governor of the PNG Reserve Bank, said the move would do little to solve the country's economic and financial problems.

Prime minister Peter O'Neill revealed last month negotiations were underway with the World Bank's IFC to create a temporary drawdown facility for local banks to access so they could overcome foreign currency issues.

But Sir Mekere said a bandaid such as this will not cure the budgetary and financial problems the country was facing, but make things worse.

He said it was not the IFC's usual role to provide balance of payments support to governments, but said this was essentially what was being proposed.

Sir Mekere said Mr O'Neill needed to recognise that there were no quick, easy fixes for the problems he had created through wasteful spending and reckless borrowing.

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