A mission from the International Monetary Fund (IMF) led by Mr. Chikahisa Sumi visited Fiji from July 17-30 to conduct Article IV consultation discussions with the Fijian authorities. At its conclusion, Mr. Sumi issued the following statement:
“Fiji is preparing for a return to democratically-elected government and progress toward elections has contributed to increasing confidence in the economy. Supported also by increased disposable income and credit expansion, GDP growth is projected to accelerate to 3.8 percent in 2014, well above the average growth rate over the past decade. Inflation has remained low partly due to low import prices but pervasive price controls cloud inflation assessment. While good progress has been made in recent years, structural reforms need to continue for the country to achieve sustainably high growth and increase resilience to external shocks.
“There are both domestic and external risks to the outlook. Domestic risks are focused on the complex political situation. On the upside, successful elections and a smooth transition to reform-oriented democratic government could result in stronger confidence in the economy and higher capital inflows. On the external risks, Australia and New Zealand, the two most important tourism markets for Fiji, could be adversely affected by lower commodity demand from China and elsewhere.
“The mission met with the Attorney General and Minister for Public Enterprises, Tourism, Industry and Trade, Reserve Bank of Fiji (RBF) Governor, Permanent Secretary for Finance, Permanent Secretary for Strategic Planning, National Development & Statistics, CEO of the Fiji Revenue and Customs Authority, and other senior public officials, as well as representatives from the private sector, academia, development partners and civil society. Staff from the World Bank and the Asian Development Bank also joined the discussion. The mission wishes to thank the authorities for their hospitality and constructive discussions held.
“The IMF Executive Board is expected to discuss the 2014 Article IV consultation in October 2014.”