Fiji has set an ambitious goal to lower its debt-to-GDP ratio to 60 percent over the next 10 to 15 years, as reported by Deputy Prime Minister and Finance Minister Professor Biman Prasad. The nation has already made significant strides, reducing its debt ratio from 90.7 percent in the financial year 2021-2022 to 79.4 percent in the current fiscal year of 2023-2024, and it is projected to further decline to about 77.8 percent by July 2025.
Prasad attributed this positive trend to a robust recovery of Fiji’s economy, which is evident in its growing Gross Domestic Product (GDP). He noted that the government’s efforts to shrink fiscal deficits from 7 percent to a more manageable 4 to 4.5 percent have played a crucial role in this economic turnaround. This approach aligns with a long-term fiscal strategy aimed at ensuring both economic growth and financial stability.
Key measures contributing to the improved fiscal health include tax reforms, enhanced efficiency within the public sector, and a focus on prioritizing impactful projects. Prasad emphasized that while the path to achieving the target ratio of 60 percent is long, persistent planning and dedication are vital.
Moreover, recent data indicates that total national debt reached $10.309 billion by July 2024, accounting for approximately 78.3 percent of GDP. This represents a downward trend from previous years, highlighting effective debt management strategies implemented by the government. Fiji’s total revenue has also seen a rise, reaching $3.645 billion, which surpassed initial forecasts by $68.3 million and marked a 32.6 percent increase year-on-year.
Despite these encouraging developments, Prasad warned of the potential consequences of failing to maintain fiscal discipline, which could harbor significant economic challenges for businesses and the wider economy.
This positive trajectory reflects the government’s commitment to fostering a sustainable economy while taking necessary fiscal precautions. The alignment of growth efforts with prudent management offers a hopeful outlook for Fiji’s economic future.
Overall, these developments highlight that through dedication and responsible fiscal policies, Fiji is on a promising path towards reduced debt and enhanced economic stability, ensuring a more secure future for its citizens.
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