Former PM: State borrowing does not boost economic growth

Andrus Ansip.
Andrus Ansip. Source: Ken Mürk/ERR

In an interview with daily newspaper Postimees, former Estonian Prime Minister and current Member of the European Parliament (MEP) Andrus Ansip said, that suggestions government borrowing can boost economic growth are myths.

"You look at the heads of the Estonian Chamber of Commerce (Eesti Kaubandus-Tööstuskoja): [and they are saying] 'let's borrow.' It's as if there is no tomorrow. Those who have taken out a loan to buy a flat can see that, unfortunately, tomorrow is already here. And then someone wise like (Indrek) Neivelt might come along and say, we will never have to pay back these loans. But, you still have to pay the interest, and pay it in such a painful way."

Ansip, who intends to run again in next year's European Parliament elections, also said it was a myth that excessive government debt would somehow reduce unemployment.


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Editor: Michael Cole

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