Treasurer cautions as growth predicted to slow over next few years

By MATTHEW VARI

Sunday, November 8, 2015 (Sunday Chronicle, PNG)  

THE Treasurer has warned for proper fiscal planning must take place over the next few years following a projected 2016 growth rate 4.3% to an eventual 3% rates for the next few years.

He added that the National Government had toned down its bold economic strategies to ensure disciplined expenditure takes place.

“Our Economy will grow by 9.9% and slow down to 4.3% in 2016, it will plateau around 3% for a couple more years before taking off again with the help of new resource ventures that are now in advanced stages of planning.”

“This is a time that needs both caution and careful planning. Caution because key parts of the world economy particularly China and the major economies are slowing down with commodity prices likely to remain low for another year or two.”

“Our bold strategies of earlier years has been tampered a little as you can see in the 2016 national budget supporting economic growth through fiscal discipline,” Mr Pruaitch said.

He aIso stated that it would be unwise for the government to stick with its previous promise to implement a balanced budget in 2017- adding that such an endeavour would happen beyond the set target time-frame due to the economic climate.

“It has become clear that it would be poorly for us to stick with our previous promise to implement a balanced budget by 2017 because such early cutbacks in the face of lower revenues could badly damage the face of the nation’s economic fortune.”

“For the first time in many years total budget expenditure this year has been reduced by K630 million to K14.2 billion with a budget deficit slightly in access of K2 billion.”

“This is the lowest deficit since the O’Neill Dion government took office three years ago.”