Debt to GDP is still lower than what it was when we came in – DPM Prasad

We have taken a very deliberate stance in raising our expenditure which means a slightly bigger deficit, that also means that our nominal debt is $11.7 billion but the most important measure of the sustainability of debt is the debt to GDP ratio.

Deputy Prime Minister and Minister for Finance, Professor Biman Prasad highlighted this at the Post Budget press conference saying when they came into government, the debt to GDP ratio was over 90 percent and in two years they have brought it down to around 75 to 76 percent.

He says they are increasing the deficit from 3.5 percent to 6 percent which is about a 2.5 percent increase.

The Deputy Prime Minister says this will take the debt to GDP ratio above what they had in the last budget to 79.8 percent which is still lower than 80 percent and 10 percent lower than what it was two years ago.

He says they can further help our people address issues such as deficit in infrastructure, health, education, HIV, new problems that we are now confronting as a result of lack of attention of those in the past.

Professor Prasad says they are very pleased with the two budgets that they did in the past because they were able to raise more revenue, that has put them in a very strong position for this budget.

The Deputy Prime Minister says they feel very confident about raising the deficit in this budget, as they are confident that the GDP is going to grow further.

He says they are looking at about $5.8 billion worth of investment projects of which a lot are being undertaken, some have been completed and what they are seeing is the interest in Fiji from overseas investors, diaspora, and they are doing a lot more work to get our diaspora to come back.

Prof. Prasad adds they expect to revise the growth forecast downwards from 3.4 to 3.2 percent, and he is very confident barring any very drastic international economic condition, they will be able to achieve higher than 3.4 percent growth.