RBF tightens exchange controls

The Reserve Bank of Fiji has tightened exchange controls with immediate effect.

Deputy RBF Governor, Sada Reddy said this move is in line with one of the bank's core objectives of safeguarding our foreign reserves.

Reddy said some of these changes include suspension of facilities while application for other facilities by customers will require the approval of the Reserve Bank. Certain transactions will continue to be delegated but at lower limits.

RBF Governor, Savenaca Narube had revealed a few days ago that the domestic economy is projected to contract by 0.3 percent this year compared with the 2.4 percent growth announced in November last year. This is due to the flash floods and the global economy.

Narube said with falling international demand, exports are projected to decline by 12.2 percent in 2009 with all major export sectors expected to be affected. Fortunately, driven by the lower oil prices, imports are also expected to decline by 10.6 percent.

Official foreign reserves at the end of February was 674 million dollars, equivalent to around 2.7 months of imports of goods.