Fiji Foreign Reserves Reach Record High At More Than $1 Billion

Level sufficient to cover 6 months of imports

By Filipe Naigulevu

SUVA, Fiji (Fiji Times, May 24, 2017) – Fiji's foreign reserves reached an all-time high this month at $2.242 billion [US$1.07 billion], an unprecedented record level equivalent to cover 6.0 months of imports.

Foreign reserves are money or other assets held by a central bank or other monetary authority that allow a country to pay it's liabilities if the need arises.

Attorney-General and Minister for Economy Aiyaz Sayed-Khaiyum highlighted this in Parliament yesterday while responding to questions on Fiji's debt level.

"Foreign reserves at the end of April 2017 were around $2.05 billion [US$978 million] sufficient to cover 5.5 months of imports," he said.

"This is way above the international benchmark of four months of imports covered the Reserve Bank follows.

"The good news is that our foreign reserves has risen to an all-time high of $2.242b [US$1.07 billion] this month equivalent to 6.0 months of imports."

Mr Sayed-Khaiyum said this was in a good position when compared with 2004 to 2005 where foreign reserves were around $500 million [US$239 million] with only two months' worth of import capacity.

"When you have companies like Fiji Airways, for example, when they go and invest in A330s, when they do as an entity for example borrow from offshore banks, what the banks also look at is the foreign reserves of a country," he said.

"If the foreign reserves of a country are in a good position, it also means that entity such as those and other state-owned enterprises or even FNPF; the interest rates are very, very attractive."

Meanwhile, Reserve Bank of Fiji governor Barry Whiteside said the record level of reserves were mainly earnings from exports and tourism, including foreign borrowing.

"It suggests that we are able to pay for anything we import and it means we can actually pay for six months worth of imports," he told this newspaper.

"That's the significance of it as it is seen as a healthy level at this time."

Fiji Times Online.
Copyright © 2017 Fiji Times Online. All Rights Reserved

Rate this article: 
No votes yet

Add new comment