Minister for Finance Professor Biman Prasad has announced that the debt-to GDP ratio is estimated to be around 78 percent at the end of July this year.

While delivering his budget address in parliament today Professor Prasad says a substantial reduction from the 90 percent they inherited from the previous administration.

Fiscal deficit is estimated to be around 4 percent for the current fiscal year lower than the 4.8 percent announced earlier.

He adds that the reduction has been welcomed by multilateral institutions credit agencies and development partners.

Professor Prasad says Fiji is in the safer zone now however almost a decade is needed to bring down the debt to GDP ratio below 50 percent.

The government is also working with multilateral partners to lower the cost of debt by replacing our expensive debt with more concessional loans.

He adds that government cannot cut spending as much as they needed to.

The 2024-2025 budget is based on the backdrop set with the total expenditure of $4.552 billion and total revenue of $3.917 billion.

“The debt-to GDP Ratio is projected to decline further to around 77.8 percent by the end of July 2025. We have seen major growth in tax collection following the reforms last year. FRCS is expected to exceed the $3 billion mark in tax collection for the first time this year.”

For the 2024-25 budget tax collections are estimated at $3.3b while non-tax revenue collected are budgeted at $618m.

Budget deficit of 4.5 percent of GDP is far lower than the double digit deficit previously.

However Prasad says they have made the decision to increase the fiscal deficit from the targeted 3.5 percent of GDP which was included as part of the earlier plan in the fiscal strategy.

Prasad says Fiji has a good rationale for this.

He adds that this increase in expenditure response is needed to reverse the trend in the growth by stimulating economic activity.

The theme for the Budget is ‘Long Term Economic Stability, Security and Sustainability of Fiji’.

You can watch the budget announcement live on FBC TV.