To my fellow citizens in Fiji and abroad.
Just six days ago I offered the nation Christmas greetings as the Coalition Government ended its first 12 months in office.
As we say goodbye to 2023, we must give thanks to the Almighty God for his endless blessings for each of us as a nation as a whole.
The new year should be a time of optimism and excitement, but also with degree of “apprehension”.
Because of the uncertainty and volatility of the global environment which are beyond our control, but will surely impact us more as a small island developing state.
We must have faith and be united in our resolve, in working together as a nation addressing any adversity we face, because “only together we can”.
I’m here tonight at the gate of 2024 to extend best wishes to you for the New Year and share thoughts on what it will bring.
It won’t be a normal New Year’s message. I’ll provide broader details than usual because we are all writing a new chapter of the complicated story of our homeland.
I say “all” because your Government cannot do this by itself. Everyone should play their part.
We are the joint authors of the Book “Fiji: 2024 and beyond”.
When the Coalition came to office last December, we were emerging from 16 years of restrictive dictatorial rule. We’ve put that behind us. It’s gone.
Much infrastructure - such as roads, water supplies and medical amenities - was broken and rundown from prolonged neglect and mismanagement of funds and efforts.
The economy was burdened by massive debt; investor morale was low, therefore investment was also low.
From day one the Coalition Government began the enormous task of reconstruction. It is not easy; it will take time.
However, in the first 12 months we have made visible progress.
Newly restored freedom empowered Fijians to once again make their views known publicly without fear of persecution. We removed an oppressive law that hung over the media like a sword poised to strike.
The Government told Fijians we would always listen to them. We put this into practice in a tangible way by staging an economic summit attended by 500 delegates representative of the community. We also appointed members of the public to a new Fiscal Review Committee.
Our aim was to hasten Fiji’s journey of recovery with the assistance of the views and ideas of this cross section of the citizenry.
More specifically, the objective was to stabilize and manage the massive debt we had inherited.
I am fully aware that some sections of our population continue to raise concern with the dilapidated state of our key infrastructure. They are saying that the coalition government is not doing enough to address this issue.
I would like to share with you the status of our nation’s debt which is a major challenge in funding of urgent needed expenditures.
As some of you are fully aware that debt servicing is a first call on government budget or revenue. We have to honor our debt commitment first before we consider other public expenditure.
As of today our national debt is around $10.3 billion which is 80% of Gross Domestic Product (GDP).
As a “rule of thumb” for a small country like Fiji, our debt ratio should be around 40 to 45% of GDP. The current ratio of 80% of GDP is not acceptable and unsustainable. However, we have to “bite the bullet” and make the necessary adjustments so that we can meet our debt obligations.
This simply means that in the 2023/2024 financial year budget, debt servicing has been allocated $1.05 billion to service our debt commitment. This is 20% of the total budget of $4.3 billion for the 2023/2024 financial year.
The $1.05 billion allocation for debt servicing will cover interest payment of $500 million and the balance of $500 million is for refinancing our existing debt.
This implies that our capacity to finance other urgent expenditure is very much limited.
This entailed cutting back on wasteful spending, improving efficiencies and growing revenue. We had to create public and investor confidence, lift the economy, increase employment, and improve infrastructure and government services.
The summit and the Fiscal Review Committee helped us with many recommendations and resolutions.
For the first time we declared an annual holiday to honour the Girmitiyas and their descendants. Then came the revival of Ratu Sukuna Day, marking the life and work of a great chief.
While we were still dealing with the severe problems of the sugar industry, we managed to give the farmers the highest ever cane price of $91.38 per tonne.
To seek mutually beneficial solutions to land lease issues, we set up a taskforce to listen to the views of landowners, tenants and others.
A great deal of effort has gone into preparing for local government elections so that political power in the towns and cities is returned to the ratepayers and residents. If things go according to plan, those elections could take place in seven to nine months’ time. That will be another milestone in revitalizing and extending democracy.
I share now expenditure figures which spell out clearly what this Government stands for; its priority policies. These tell you that we are for the people - for families, parents, children, the young, students, and the elderly.
Within the 2023/2024 budget period we will spend over $1.2 billion dollars for these groups and their needs.
• It includes write-offs of $650 million dollars for the TELS scheme benefitting 53,000 students and families. It is the first time this kind of financial relief has been granted in Fiji by any government.
• There are 90,000 beneficiaries of total social welfare payments of $160 million dollars. We increased some of these by 15 percent and 25 percent for those over 70.
• Approximately 2,000 government pensioners received a 15 percent increase from funding of $37 million dollars.
• The pension rates of many FNPF pensioners were illegally cut back by the former regime. We’ve acted to give some monthly relief to the surviving members of the aggrieved group while continuing dialogue with the FNPF with the aim of giving the victims full justice in 2024.
• Allowances amounting to $15 million dollars for around 10,200 ex-servicemen went up by 15 percent.
• New back-to-school payments of $90 million dollars benefited about 223,000 children and their parents. This was also a first.
• Full scholarships valued at $148 million dollars went to about 10,900 new students and 9,149 existing tertiary students. Again, this substantially assisted many families.
• So did an amount of $100 million dollars, allocated for free education and school transport assistance.
The Coalition Government reversed a policy by the last administration of withholding grants due to the University of the South Pacific.
We boosted the health budget to $545 million dollars in recognition of the desperate need for upgrading some hospitals and health centres. This is a work in progress.
I confirm to you that in 2024 our policies for the people will remain. Where possible we will increase payments I’ve just mentioned.
The Government is predicting that 2024 will be a big year for Fiji. There are reasons for caution however that I will mention later.
The economy is now in a much stronger position – it grew by a healthy 8.2 percent last year – wage rates are increasing, investor confidence is high, new jobs are being created.
I can report that based on information from the FNPF, wages and salaries for permanent and full-time employees increased between 10 to 12 percent compared to 2019. This is a reflection of the marketplace at work. However, the Government is not just relying on market forces to determine wages and salaries.
As promised in the budget we will review minimum wages. You can expect some decisions in the next few months.
We are very much aware of public comments about the cost of living. What I can tell you is this: The inflation rate – meaning price increases – is moderate and lower than some countries, including neighbouring nations. The same applies to the cost of living.
Government budget measures helped cushion the impact of price rises on certain products.
Please remember we decided that no VAT would be charged on 22 food items, including prescribed medicines. In fact, the cost of many food items actually went down – examples are milk, cooking oil and meat products. Some prices were reduced following a reduction of import duties.
The potential scale of investment that will reshape and rebuild our economy to benefit everyone, is very high.
From my own experience, I cannot recall a time when the investment prospects looked this good.
Investment Fiji reports a large number of planned, renovated and new projects. Some of them are well underway. They include real estate developments and apartments, a business park, six shopping malls, hardware industry expansion, office buildings, restaurants, agriculture, aviation, and a mining venture dedicated to responsible resource extraction.
Tourism, centrepiece of the economy, is surging. Current estimates indicate the industry employs about 110,000 people. We expect that figure to grow when more rooms are available.
This year annual visitor totals for the first time might surpass one million. The big challenge is to meet a shortage of about 5,000 rooms.
Investors see the opportunities here. Currently there are at least eight significant hotel and resort projects underway with more on the drawing board.
It’s been evident for a long time there is great scope for tourism to develop in new areas of the country. We have already announced the World Bank has agreed to commit just over $440 million to unlock Vanua Levu’s potential. This is of huge and positive importance for our second largest island and for Fiji. We’ll be keeping you informed about this.
A particular project is expected to move ahead quickly. It represents an expression of confidence in our country by Google, one of the world’s best-known and most powerful companies. This American multinational technology enterprise, has chosen Fiji to be a key part of a substantial expansion plan – the Pacific Connect Initiative.
This can become a game-changer for our entire economy, bringing us directly into the ever-expanding heart of the digital revolution sweeping the globe.
The initiative will feature under-sea cables – one named Tabua, the other Honomoana - connecting Fiji and French Polynesia to the US and Australia.
Such cables are the backbone of modern global communication, linking continents and facilitating exchanges of data, information, decisions and ideas.
Cable landing stations are to be constructed in Fiji and French Polynesia and connected to an interlink cable, improving reliability and capacity for users in the Pacific Islands and beyond.
So we consolidate our role as the hub of the Pacific while becoming a bridge for the progress of our friends and neighbours.
The local project expenditure by Google is initially estimated at $200 million.
Our digital and related technological capacity and connectivity will expand, stretching from urban and rural to island areas. This in turn will boost our overall development and create, over time, several thousand new jobs. There will be benefits and opportunities in health care, education, agriculture, manufacturing, disaster relief and management.
Apart from the enormous opportunities created for economic expansion and diversification, the Pacific Connect initiative provides a new option for Fiji’s institutional investors such as FNPF, Fijian Holdings and BSP Life.
The ocean cables fit into our on-going battle to minimize the effects of climate change. They have a very small carbon footprint.
Ladies and gentlemen, I think you will agree that we are on the verge of what might become an investment boom.
However, we need to make absolutely sure that our investment approval processes are operating as efficiently as possible.
I am picking up some criticism that the public service and regulatory bodies involved sometimes fall short. The decision-making becomes slow and cumbersome. Entrepreneurs have only so much tolerance for delay. If it becomes too much of a problem, they will take their money and expertise elsewhere.
So in the new year I’ll be focusing on this with my Cabinet colleagues. We will review the situation to ensure that Fiji does not miss the bus.
We should be concerned as well about the state of the world. You all know about the perils, the problems and the bloodshed resulting from the conflicts in the Middle East, between Russia and Ukraine, and in other places.
We must pray that this does not transition into a massive international crisis leading to a conflagration.
We in Government will play our part, on your behalf, in speaking out in international forums and elsewhere for reconciliation, peace and goodwill.
This has been the longest New Year address I’ve ever made. I could have spoken for much longer; there are so many topics and policies on our agenda. But I think it’s time for me to say goodnight. I hope to speak to you again soon.
Let’s keep our focus as Fijians on that Book of Fiji; and make sure it has a joyful ending for us, for our children and islands.
A very happy New Year to you all. May God bless Fiji now and forever.