Country should stop borrowing, says Abel

Posted on The National

FORMER Treasurer Charles Abel, pictured, thinks that the country should stop borrowing because we pay more than K1.3 billion interest on repayment loans.
He said the way forward is to live within the means on what we have and improve on the revenues streams.
He said when the country gets a loan, the country pays about K1.3 billion in interest on repayment loans and that is not good.
Abel said this when commenting on the status of the economy when asked in an interview on Thursday last week during the handover of the Minister to the new Minister of Treasury Sam Basil.
“My view is that, we should not get loans,” he said.
However, he said, whilst they have made a progress in the economy, there are some things that are not good in the way they manage and run the economy and he wants to see that addressed by the new Government led by Prime Minister James Marape. He said among them is the major revenue earner, the Kumul Petroleum Holding Limited needed to be relooked at so there is visibility by the Government instead of allowing the board and management to run it at own will.
The Government itself establishes a structure like the Kumul structure that funnels the dividends, the biggest revenue flow goes to the Kumul structure.
He said the Kumul structure is a good structure with good intentions, similar to the Sovereign Wealth Structure, or what he calls by “squashy sovereignty wealth fund”, because the investment guideline and mandate is too board.
“It’s ok they make good investment over there but on the other hand we are borrowing to fund the budget. To me, this revenues should come into the budget and come into and properly and strictly established sovereign wealth fund, not a squashy sovereign wealth fund as I call it,” Abel said.

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