18 Nov 2006

Samoa banks face liquidity problems

4:54 am on 18 November 2006

Samoa's Minister of Finance, Niko Lee Hang, says local commercial banks in the country are experiencing liquidity problems because of over spending by government in the last three years.

Un-confirmed sources say the current situation has forced the government to delay work on some major infrastructure projects following advice from the Central bank.

It is also reported that business people have complained about the lack of funds currently available for borrowing.

But the minister of finance has told the Samoa Observer Newspaper that the major reasons are the government's "too expansionary " spending and the private sectors hunger for funds from the banks.

Lee Hang says preparations for the South Pacific games next year and business people wanting to expand and develop their businesses are other contributing factors.