Attorney-General and Minister for Economy, Aiyaz Sayed-Khaiyum, says financial institutions lend money to Fiji because they know that Fiji has the ability to pay the debt.

During the Financial Year 2022-2023 National Budget Consultations at the Sugar Cane Growers Council Hall in Lautoka yesterday, the A-G said Fiji’s debt to GDP ratio went from 46 per cent before the pandemic to 80 per cent after the pandemic.

He said New Zealand’s debt to GDP ratio before the pandemic was 28 per cent and after the pandemic was 52 per cent.

“NZ has exceeded 50 per cent so its debt has almost doubled even for a country like NZ,” the A-G said.

“Australia 42 per cent to 62 per cent, Malaysia 56 per cent to 71 per cent, Maldives 72 per cent to 137 per cent, Mauritius 66 per cent to 101 per cent.

“So every single country has been through this period because every single country, in particular, countries that were service-driven, had a huge impact on government revenue so, in order for them to continue the services, they have to actually borrow more to be able to continue with that economic well-being, particular economic stability making sure that people have their livelihoods, that people don’t starve.

“Look at the debt of the GDP ratio of Japan 257 per cent, nobody said Japan is in trouble, only people in Fiji say that Fiji is in trouble, the question that they ask is, does Fiji have the ability to pay the debt? If it did not have the ability to pay the debt, all these organisations and banks won’t lend to us.”

He said banks would not lend money if people could not pay it back.

“ADB continues to lend us money, World Bank continues to lend us money, other developmental partners continue to lend us money, why? because they know we have the ability to pay the debt,” the A-G added.

“They know the economy is managed well even though we had COVID and they know every other country is going through the same situation.”

The A-G also mentioned that the Government had no control over the prices of items coming in from overseas, but it had control over certain domestic items.

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