COVID-19 affected Fiji gets new budget
July 16, 2021 10:02 pm
Ariel view of Suva City. [File Photo]
The government has announced its latest budget, with the Minister for Economy saying it is tough times which calls for best measures for Fiji and her people.
The government has forecast a total revenue for the new financial year at $2.8 billion, compared to $1.6b for the last financial year with expenditure set at $3.9b up from $3.6b.
This is a net deficit of $1.61b or 16.2% of GDP. The projected debt level is now at 91.6% of GDP.
Tax revenue for the new year is set at $1.59b, which is 45% lower than pre-COVID levels but a little higher than the last budget. Last year it was estimated at around $1.46b.
The government is also carrying forward a cash balance of around $150 million which will provide a buffer should tax revenue underperform.
Economy Minister, Aiyaz Sayed-Khaiyum, says there is a lot of uncertainty with the impact of COVID-19.
“Mr Speaker Sir, given that we still lack the luxury of complete certainty, we have adopted the same conservative revenue strategy as last year. The downside is again the high projected level of debt. We have to make such projections because we could indeed have high debt levels next year if our economy does not fully reopen and we want to be fully transparent about the consequences of the worst-case scenario.”
With the Delta variant wrecking the Fijian economy and affecting Fijians, Sayed-Khaiyum, says Fiji is facing a tough crisis.
“There is nothing ordinary Mr Speaker Sir, about our lives at this moment. Never has our personal wellbeing and the health of our economy been more intertwined. So this will not be an ordinary budget.”
He goes on to say the pandemic has rattled everyone.
“This pandemic has stolen jobs and precious lives. It has kept families apart in times of celebrations and sadness. It has crippled industries built over the years through a strong vision in years of steady investment. And the arrival of more virulent variants has sent its devastating toll to painful new heights.”
Sayed-Khaiyum adds that Fiji needs its eligible population to get vaccinated if we are to reshape the economy.