Debt projected to hit $11.37 billion ahead of election

Fiji's national debt is projected to climb to $11.37 billion by the end of July, according to the Government's Pre-Election Economic and Fiscal Update.

The report forecasts total Government debt will reach $11.373 billion, equivalent to 80.9 per cent of Gross Domestic Product (GDP), comprising $7.529 billion in domestic debt and $3.844 billion in external debt.

While the debt level remains below the peak recorded during the COVID-19 recovery period, the report acknowledges that Government debt remains elevated.

The update shows debt increased from $10.944 billion in 2021-2022 to $11.736 billion in 2022-2023 before easing to $11.034 billion in 2024-2025. It is now expected to rise again in 2025-2026.

Government said the increase in debt over recent years was driven by revenue losses and economic support measures introduced during and after the pandemic.

Despite the rise, the report said debt sustainability remains a priority, with fiscal consolidation measures aimed at gradually reducing borrowing requirements.

The Ministry of Finance projects total debt will continue increasing to $12.39 billion in 2026-2027, although the debt-to-GDP ratio is forecast to decline to 84.7 per cent as economic activity expands.

The report notes that Fiji's debt composition remains largely domestic, with domestic debt accounting for 66.2 per cent of total debt and external debt making up 33.8 per cent.

Government said it remains committed to reducing debt to sustainable levels through improved revenue collection, expenditure restraint and economic growth.