The Fiji Commerce and Employers Federation has expressed concern that the projected national debt will exceed 90 percent of GDP by 2028, and calls for immediate fiscal consolidation and restraint on public spending.
FCEF Chief Executive Officer, Edward Bernard says the recently launched Fiji Economic Update report by the World Bank highlights the urgent need to put debt on a sustainable path and reduce lower priority recurrent costs.
Bernard says at the current projected rate, debt is growing faster than the economy.
He adds that the tight fiscal space does not allow Government to prepare for the next big shock and broaden the economy.
Bernard says the high cost of fuel due to low supply and impact of the El Nino is slowly squeezing national resources.
He says with only 20 percent of the national budget allocated for capital expenditure such as critical infrastructure, it is already restricting the private sector to accelerate economic growth and weakening retention of skilled people in Fiji.
FCEF is also concerned about the declining foreign reserves that could start to impact trade.
Bernard says the report emphasises that tourism earnings and remittance together cannot buffer our import bill, therefore, there is an urgent need to diversify the economy, protect local industries and
increase exports and import substitute goods.
