Fiscal reforms put Fiji on track for debt reduction

July 10, 2024 12:33 pm

The government anticipates that Fiji’s debt-to-Gross Domestic Product ratio will reduce to 78 percent by the end of this month.

Finance Minister Professor Biman Prasad highlighted this in Parliament in his right of reply to the contributions by Members of Parliament on the 2024-25 National Budget.

Prasad says Fiji’s debt-to-GDP ratio peaked at around 90 percent of GDP by July 2022.

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Aerial shot of Suva City [File Photo]

He says this is a rise from 56 percent in 2006.

The Finance Minister says the government expects a reduction of 12 points by the end of this month, indicating what the coalition government has achieved in 18 months.

“This is not an easy feat but a great achievement for us as a nation, putting a path, a foundation for a downward trajectory in our debt-to-GDP ratio. Even more importantly, with the fiscal reforms in the last budget, we have fixed our revenue problem and brought fiscal deficits from the double-digit level prior to us getting into government.”

Prasad says this means that as the economy grows, Fiji’s debt-to-GDP ratio will continue on a downward path.

He stresses the need for Fiji to continue on this course as he highlighted that this is not a problem that can be fixed in the short term.

The Finance Minister says the government is setting a path and a fiscal plan for the next decade.

He adds that the political will and national resolve to get Fiji’s debt problem under control has been commended by international agencies, credit rating agencies, and financial institutions.

Prasad says this provides confidence for investors looking into Fiji.