IMF predicts economic recovery by year end for Fiji
October 9, 2021 11:50 am
The International Monetary Fund has forecast a gradual recovery in Fiji’s economy late this year.
The IMF team leader Todd Schneider says COVID-19 put Fiji in a tight corner, and the government had to make tough decisions and borrow more.
“You know, the rising public debt is the mirror image of the large fiscal deficits that the government had to undertake in the course of the pandemic.”
Minister for Economy, Aiyaz Sayed-Khaiyum says they have spent hundreds of millions of dollars in unemployment benefits, assistance to small businesses while revenue streams have been restricted.
“There were certain socio-economic measures that we did not want to refrain from or we wanted to conversely continue with. So we did not stop free education, we did not stop social welfare payments. We increased unemployment assistance by $340M.”
The International Monetary Fund has commended the government for trying to balance its responsibilities.
“The government in its most recent budget made a very clear commitment of fiscal consolidation which needs to be a liege pin in the medium term.”
They also recommend that government policies continue to be supportive, but with a strong emphasis on putting finances on a sustainable footing and reducing public debt.
Increasing State revenue must also be done in a growth-friendly manner.