Fiji’s commitment to its Interim Economic Partnership Agreement (IEPA) with the European Union (EU) will lead to an estimated annual revenue loss of $737,000 due to a reduction in import duties. However, this loss is being balanced by Fiji’s exports to the EU, which amount to $132 million.
This information was shared by Deputy Prime Minister and Minister for Trade Manoa Kamikamica during a parliamentary statement. He explained that a decrease in Fiji’s market access commitment from 80 percent to 75 percent, achieved through technical amendments to the trade agreement, would result in the elimination of tariffs on 4,916 import items from the EU.
Currently, 32 percent of those items already enjoy zero fiscal duties under the More Favourable Nations (MFN) clause, thus requiring Fiji to liberalize the remaining 43 percent. DPM Kamikamica noted that the implementation of duty reductions on these items is expected to cause a revenue loss of about $737,000 per year. This estimate is based on average import duties collected over the past six years for the tariff lines Fiji has agreed to eliminate under the IEPA.
He emphasized that the advantages gained from trade considerably outweigh the projected revenue loss due to the removal of tariffs on EU products. Fiji currently exports goods such as tuna, ginger, mineral water, garments, and kava, collectively valued at $132 million.
The Deputy Prime Minister assured that the government will closely monitor the elimination of tariffs to ensure they positively affect the local economy, enabling the prompt resolution of any challenges that may arise.