Govt not in debt distress situation: Treasurer
Treasurer Samuel Basil has backed Prime Minister James Marape, saying that the Government is not in a debt distress situation to seek refinancing for its debt stock.
He said there is also no policy advice from the Department of Treasury on the need to re-finance its debt stock.
Basil says PNG can pride itself on its credit worthiness backed by its enviable reputation of timely payments on its loan repayments.
Minister Basil said loan contracts have legal implications and are guided by terms and conditions that see loans reach their full maturity.
He stressed that re-financing will incur extra costs if terms and conditions are deemed to be breached so the Government will treat this with extreme caution as rightly inferred by the Prime Minister.
The Treasurer clarified that PNG did not want to send the wrong signal to other lenders like the ADB, World Bank and IMF by pursuing offers of re-financing arrangements. Each suggestion or offer will be considered on its own merits, with what is best for PNG uppermost in mind.
PNG’s current debt portfolio is well diversified amongst multilateral creditors, bilateral creditors and commercial lenders, spreading the risks among the different creditors.
The Treasurer again stressed that the question of re-financing is a debt distress signal from a country that may be facing bankruptcy, which is not PNG’s situation.