Usamate warns Fiji is borrowing its way into a debt crisis

Opposition MP Jone Usamate has warned that Fiji is on an unsustainable fiscal path, saying rising debt, growing expenditure and declining revenue are placing the country at risk of a future debt crisis.

Speaking during the 2026-2027 Budget debate in Parliament, Mr Usamate described the Coalition Government's Budget as "not responsible and sustainable enough".

He said the projected gross deficit of $1.481 billion meant Government would need to continue borrowing heavily while also meeting significant debt repayments and interest costs.

"This is the crisis," Mr Usamate said.

"When people say there is no crisis, this is the crisis. It's about how we are going to manage our future.

"Revenue is declining and debt is increasing. We have to keep borrowing at this level just to maintain the same level of expenditure."

Mr Usamate described the Budget as a "budget of fiscal exhaustion", arguing it failed to make difficult decisions such as reducing government spending and downsizing the public sector.

He warned that the current fiscal path could make it more difficult for Fiji to refinance its debt in the future.

"The budget tries to be responsible, but it is not responsible enough," he said.

"It tries to be the catalyst for a sustainable future, but it does not do so."

Mr Usamate said too much of the national Budget was being spent on operating costs instead of investments that would drive economic growth and generate future revenue.

"Four billion out of our $4.8 billion budget is operational expenditure," he claimed.

"That is the elephant in the room. We need to identify unnecessary spending and remove it so we can grow as a country."

He argued that Fiji had only two realistic options to improve its financial position: grow the economy or reduce spending.

While economic growth remained the preferred long-term solution, he said it would take time and could not be relied upon to address immediate fiscal pressures.

"To get out of this crisis, there are only two things we can do," he said.

"One is to grow the economy. The other way is to cut expenses."

Mr Usamate warned that failing to act would leave Fiji trapped in a cycle of rising debt and continued borrowing.

"If not, we will dig a deeper and deeper hole, and we are going to drag this whole country with us," he said.