Re: Letter to Prime Minister Tuilaepa Sa’ilele Malielegoi
The debt incurred by this government is totally out of control.
When we joined the World Trade Organization, it was a step up in the world of complex financial dealings that a lot of poor nations were enticed by big banks of the world to loan them money to fund their infrastructure developments etc.
We were elevated from an underdeveloped country to a developed country status not too long ago and our gov’t. didn’t waste any time in taking advantage of that status.
Banks were standing by with huge Capital infusion that we can’t reject to finance all these blocks of buildings we are seeing going up all over the place.
That will come with a price to pay in the long run because we cannot over-extend ourselves to oblivion.
We no longer have the privilege as an underdeveloped country status to finance our loans on cheap interest rates because we have stepped up in the developed nation status category.
The Keynesian economic approach that the P.M. is using will only work if the tourist industry pans out to be a viable resource to stimulate the economy and to provide more jobs and increase tax revenue to pay back these loans.
The way it looks is that we are taking too much risks in taking in more loans than what we are producing that might eat away with the G.D.P. growth and ultimately might force banks to down grade our status to chunk bonds when we default on these loans.
Only time will tell but the aura of reality is written on the wall.
Stay tuned when that day comes, the day of reckoning!