Limited room for budget cuts, says Finance Minister

Government has limited room to cut expenditure during the current financial year, despite concerns over rising public debt, the global fuel crisis and El Niño.

Minister for Finance Esrom Immanuel said the National Budget had already factored in the economic challenges facing Fiji, leaving little room for further spending adjustments.

He said Government had introduced mitigation measures in February and continued to review expenditure to manage the impact of the crisis.

“For this financial year, I don’t think we can do much,” Mr Immanuel said.

He said discussions with the World Bank and Asian Development Bank (ADB) had highlighted the global nature of the crisis, which was affecting countries beyond Fiji.

Mr Immanuel said Government had begun implementing cost-cutting measures and rationalising expenditure.

He revealed that public debt stood at about $11.6 billion as at September 30, equivalent to 78.4 per cent of the estimated gross domestic product (GDP) of $14.8 billion.

This comprised $7.6 billion in domestic borrowing and $4 billion in external debt. Public debt is projected to rise to $12.6 billion, or 84.8 per cent of GDP, by next July.

Government has budgeted about $1.03 billion for debt servicing in the 2026-2027 financial year, including $572 million in interest payments.

Mr Immanuel said Government remained committed to responsible borrowing while financing infrastructure, education, healthcare, social protection and climate resilience programmes.

He said expenditure decisions had to balance the need to sustain the economy with the protection of vulnerable people during the current crisis.