The 2025-2026 national budget will run a wider deficit as the government boosts spending to shield the country from deepening global uncertainty.

Finance Minister and Deputy Prime Minister Professor Biman Prasad says the Government spends $4.8 billion, while revenue is forecast at $3.9 billion, leaving a deficit of $886 million or 6.0 percent of GDP.

This is nearly double last year’s three percent deficit.

Professor Prasad states that the higher deficit is intentional.

This, he adds, is made possible by tough revenue and tax decisions over the past two years that give the Government the room to act now.

Public debt is projected at $11.7 billion, or 79.8 percent of GDP, down from the 90 percent ratio the Coalition inherited when it took office in 2022.

Professor Prasad says this year’s budget responds directly to global tensions, including conflict in the Middle East and supply chain disruptions.

He adds the focus is on protecting families from the rising cost of living, maintaining core services, and building long-term economic resilience.

The budget keeps zero VAT on 22 essential items, continues the $200 back-to-school support, and sustains free education, subsidized transport, and healthcare. It also increases support for the elderly and vulnerable.

Health, infrastructure, agriculture, education, and law enforcement remain key investment priorities.

More than 170 investment projects valued at $5.8 billion are in the pipeline. Professor Prasad says this reflects growing private sector confidence in the economy.

While Fiji’s 2025 economic growth forecast has been revised slightly down to 3.2 percent, from an earlier estimate of 3.4, Professor Prasad says the fundamentals remain strong.

He points to $3.7 billion in foreign reserves, and inflation falling to 0.1 percent in May, down from 5.1 percent a year earlier.

He adds that the budget is clear and predictable. There are no surprises.

The goal, Professor Prasad says, is to keep Fiji stable through uncertain times.

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