ECONOMIST: TAHITI ECONOMY NEEDS MAJOR OVERHAUL

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French territory enters third year of recession

MELBOURNE, Australia (Radio Australia, Feb. 13, 2011) - There is a call for French Polynesia to have a new budget model - as the territory's economy enters its third year in recession.

Economists there say the budget crisis is further stifling growth and investment.

French Polynesia has had 12 governments since 2004 and the current president, Gaston Tong Sang, has lost the support of his government on key economic plans.

An economics specialist at the University of French Polynesia, Associate Professor Vincent Dropsy, says the economic situation is not helping resolve the continuing political crisis.

He said what the territory needs is a new economic model.

Professor Dropsy told Radio Australia's Pacific Beat: "The world economic crisis over the last couple of years has had a very negative impact, of course, on the local economy.

"But it is also a long-term crisis. So at this time we can say that the budget crisis is also (a) reflection of this general economic crisis.

"The political instability makes things even worse.

"It seems that the incapacity of the current French Polynesian Assembly to find consensus around the budget is more political than economic."

[PIR editor’s note: Tahiti Presse reported that "if the 2011 budget is not voted by March 31st, the new French High commissioner, Richard Didier, will have to resolve the ongoing budget crisis."]

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