The Asian Development Bank has predicted that Fiji’s strong economic rebound in the tourism sector will result in the increase in government revenue collection.
It says this will in turn narrow Fiji’s national deficit for 2023.
This, ADB said, is equivalent to 6.2 per cent of Gross Domestic Product, compared to 7.4 per cent forecasted earlier this year by ADB.
In its Outlook Report, ADB said Government revenue has increased by 22.6 per cent for 2023, and expenditure was up a modest 0.6 per cent.
ADB said the Government is targeting a 37.8 per cent increase in revenue for the second half of the 2023-2024 financial year – Which would finance a 26 per cent increase in budgeted spending.
“If the target is hit, the fiscal deficit’s downward trend should continue, to a forecast 4.8 per cent of GDP and a lower debt to GDP ratio of 79.3 per cent compared to 81.2 in 2022-2023 financial year,” the report said.
Also, the inflation forecasts are revised down for 2023 and 2024 on lower-than-expected consumer prices, especially since earlier this year.
ADB added that lower fuel prices translated into utility prices declining by 4.6 per cent and transport prices by 9.9 per cent in the 12 months to July 2023.