15 Aug 2018

Tonga's PM wants regional push for China to forgive debts

5:20 am on 15 August 2018
Tonga Prime Minister, 'Akilisi Pohiva

Tonga Prime Minister, 'Akilisi Pohiva Photo: RNZ Pacific / Koro Vaka'uta

Tonga's Prime Minister says the Pacific Islands Forum should lobby China to drop debts owed to it by Pacific countries.

'Akilisi Pohiva says Tonga is two years overdue on Chinese loan payments, but will this year pay $US14 million towards its outstanding $US160 million debt.

He told the Samoa Observer that if Pacific Islands don't pay their debts to China's government, it will seize their assets as collateral.

He says the only option for Tonga and other indebted nations is to ask China to forgive the debts.

Mr Pohiva has repeatedly asked China's government to forgive Tonga's debt, which is a substantial portion of the kingdom's GDP, or convert the loans to grants.

But Beijing has also repeatedly refused Mr Pohiva's request, creating a stalemate that eventually broke with the government's announcement that it would slowly start repaying the debt.

In his interview, Mr Pohiva also warned other countries to "slow down" in asking China for loans.