Finance and Treasury Minister Rick Hou says Cabinet has endorsed the first Debt Management Strategy for the country.
"This strategy will guide the government in its debt management decisions over the next three to five years," said the Finance Minister."For the first time this will allow government to carefully make decisions on new borrowing which will now target high quality projects."
Mr. Hou says governments in the past did not have a debt strategy, making debt management ineffective.
The Finance Minister says the debt strategy would make sure that debt is kept at "affordable and sustainable levels and that risks are minimized."
He says as part of the strategy a Debt Management Advisory Committee has been established to assess future government borrowing proposals, seeking to ensure that only projects of high value, in terms of revenue and benefit to citizens, are considered.
Those closely involved in the development of the strategy say without effective coordination and oversight, debt cannot be effectively managed and government borrowing can quickly spiral out of control.
They say some of the most important steps in debt management involve creating an effective legal and institutional structure to coordinate and control debt.