FIJI GOLD MINE PRODUCTION UP 77 PERCENT

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Outlook for rejuvenated mine ‘favorable’

Elenoa Baselala SUVA, Fiji (Fiji Times, Feb. 9, 2011) – In Fiji, the Vatukoula Gold Mines Limited (VGML) has continued to increase production since its recommencement in May 2008, registering a yearly increase of 77.2 per cent in 2010.

While this was still below the levels attained prior to the temporary closure of the mine in December 2006, the Reserve Bank of Fiji (RBF) said the outlook for the industry looked favorable. This as high world market prices for the commodity and the increased productive capacity of the VGML continue to sustain local production.

Domestically, the Fiji economy is projected to grow by 1.3 per cent this year following a slight expansion of 0.1 per cent forecast in 2010. In 2012, the economy is anticipated to advance further by 0.8 per cent.

While visitor arrivals, gold production and consumer spending picked-up further towards the end of 2010, lower sugar and cane output and subdued investment activity was also evident during this period.

"The tourism industry performed exceptionally well last year as reflected in the 17.6 per cent annual growth in visitor arrivals cumulative to October, the RBF said. Furthermore, provisional estimates from the industry suggest that 2010 is the new record year for tourism, with arrivals exceeding 600,000. Last year, the cane and sugar industries were adversely affected by frequent mill breakdowns, which restrained the harvesting and delivery of cane to the mills and a relatively shorter crushing season. Consequently, both cane and sugar production declined in 2010 by around 20.9 per cent and 21.5 per cent on an annual basis."

The global economic growth projections have been revised upward as recovery in advanced, developing and emerging market economies advances.

The International Monetary Fund (IMF) now expects the world economy to grow by 4.4 per cent in 2011 from the 4.2 per cent envisaged earlier. A further 4.5 per cent growth is projected for 2012.

The upward revision was because of general improvements in global financial conditions and stronger-than-expected consumption activity in the United States and Japan during the second half of 2010.

Nonetheless, the uneven recovery pace continues with China and India on the lead. Downside risks to the recovery remain, especially on the uncertainty of the Euro area crisis, high commodity prices and the possible overheating in emerging markets.

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