Fiscal consolidation and structural reforms are critical aspect that need to be considered to ensure Fiji’s debt level is on a sustainable path.
International Monetary Fund Deputy Managing Director Bo Li says sustainably managing public debt will prevent Fiji from external shocks including the turbulence and volatility in the international market.
Li says they have been advising the Fijian government top capitalize on Fiji’s rebounding economy.
“Fiji’s public debt right now is 30 percent is external and 70 percent is domestic. The external part is almost all on concessional terms. We think that gives Fiji some cushion in dealing with international volatility and of course going forward it is important that we continue to secure concessional financing internationally and also together with the fiscal consolidation plan. We hope this can put the government debt in a sustainable path.”
The Deputy Managing Director says while Fiji faces challenges such as inflation and public debt, it is in a much safer position compared to most developing countries.
Li says it is also critical to have a combination of a sound macro-economic policy which include fiscal, monetary, financial and structural in order to move the country forward.