Fiji will experience a revenue loss of $737,000 annually due to the reduction in import duties as part of its commitment to the Interim Economic Partnership Agreement (IEPA) with the European Union (EU). This financial setback is being balanced by Fiji’s substantial exports to the EU, totaling $132 million.
Deputy Prime Minister and Minister for Trade Manoa Kamikamica disclosed this information during a parliamentary statement on Monday. He explained that the modification of Fiji’s market access commitment from 80% to 75% would lead to the elimination of tariffs on 4,916 specific items imported from the EU.
Currently, fiscal duties on 32% of these items are already set at zero due to the Most Favored Nation (MFN) clause. Consequently, Fiji needs to liberalize just 43% of the remaining tariffs. The projected revenue loss from this adjustment is approximately $737,000 per year, based on average import duties over the past six years for the specific tariff lines that Fiji intends to remove under the IEPA.
Kamikamica emphasized the existing trade benefits significantly surpass any revenue lost from tariff removals on EU goods. He highlighted that Fiji exports a variety of products, including tuna, ginger, mineral water, garments, and kava, which altogether amount to $132 million.
Moving forward, the Deputy Prime Minister assured that the Government will closely monitor the implementation process to ensure that the elimination of tariffs positively affects the local economy, enabling prompt responses to any challenges that may surface.