Negative outlook for Fiji’s credit rating

The outlook on Fiji’s long-term sovereign credit rating has been revised down from stable to negative by the international rating agency Standard and Poors.

The sovereign credit rating indicates the level of risk in investing in a specific country, and takes into account the political risks in that country.

Fiji’s sovereign credit rating remains at B.

Standard and Poors has downgraded the outlook for the rating’s future because of what it describes as a “quite dramatic fall in Fiji’s international reserves” – from $US618 million ($982 million) at the end of 2007 to $US431 million ($684 million) in December 2008.

The downgrade follows a similar action taken by Moody’s ratings agency in February.

Standard and Poor’s sovereign ratings analyst, Kyran Curry, said weak growth prospects especially in tourism, sugar and garments also contributed to Fiji’s downgraded outlook.

The outlook on Papua New Guinea and Cook Islands, remains unchanged.

Mr Curry says that at this stage, Papua New Guinea and Cook Islands have weathered the financial crisis better than many countries, but warns they remain vulnerable to low commodity prices and tourist numbers.

10 Responses to “Negative outlook for Fiji’s credit rating”

  1. Koya na Man Says:

    Our country would have benefited very mch from this financial crisis if there political enviroment was stable.

    Big corporations in the AUstralasia region are moving to India and China to take advantage of the competitive labour costs they provide and to save big dollars in this non variable expanse which cuts out a big chunk of their profit.

    If our country could only provide the platform(go back to democratic rule & the army do what it does best go back to the barracks and wait for deployment overseas to bring foreign exchange) we might be enjoying some level of finacial comfort from this current event.This is simply bcoz we are a close neighbour and we provide that edge of compepetive labour costs,and all the infrastructure that requires this level of operation currently exists(the international Airport,telecommunication,roads e.t.c.).

    Food for thought..

  2. Nostradamus Says:

    Not sure how competitive Fiji is. The RBF has raised the important issue of productivity. I hate to think of how Fiji stacks up against China and India on this measure. My guess it that labour rates in Fiji are much higher and physical output lower (people disappear whenever there is a funeral). But yes, it is worth thinking about and measures taken to become more competitive. It does not help for the nation to have to support a deadbeat army which really does nothing positive, and plenty negative, to justify its pay. One of their primary roles is to protect the elected government of the say. Need I say more?

  3. Keep The Faith Says:

    No wonder Shitsa and Iyass (for whom fiscal policy is not in their professional remit) are not wasting any effort to fire back at any attack on their junta clique having NOTHING to do with the dire economic straits we are now in.

    All things are falling apart. Where’s the voice of the illegal Finance Minister in this fcuk-up?

  4. Ram Says:

    We all know that Poreqi Bainimaramu has screwed up big time? His original culcalation obviously did not worked out, as he had originally plan.
    The Fijians whom he figered would support him and his military perpetrators during the coup,did not follow tradition and continue to oppossed his dictatorial leadership style.
    Seems to me that we will all have to help each others, in creative ideas, if we want to remove this man and his people from power and reclaimed our democratic constitutional Government?
    Can we make a deal with a foreign power to give these people safe haven in the country?
    Would a new election without Mr Qarase as leader of the SDL, be an acceptable solution for Poreqi, to allow a constitutionally elected Government to run the affairs of our nation?THE QUESTION IS: “WHAT WOULD IT TAKE FOR THIS MAD MAN TO RELINGUISHED ADMINISTRATIVE POWER BACK TO OUR CIVIL SOCIETY?”

  5. EnufDictatorship Says:

    @ Ram…although I didn’t vote in the last election, I don’t think having a new election without Qarase as the SDL leader is ACCEPTABLE or DEMOCRATIC for that matter!

    Qarase is a citizen and has every right to be the leader of SDL if that is what the SDL supporters want. ANd that would also go for you and I.

    Voreqe has no business and power to tell us what we want for ourselves. And this has been the problem all along. His holier-than-thou and self-righteous attitude is backfiring on him because HE DIDN’T HAVE THE MENTAL CAPACITY TO FORESEE THE CONSEQUENCES OF HIS STUPID, STUPID ACTIONS!

    It’s his GUNS only that has got him this far! Nothing more than that.

    But we have our collective democratic values, ideals, wisdom, prayers, hope and faith that the LIGHT will shine at the end of the dark tunnel.

  6. Ram Says:

    Enuf, appreciated and i support your points ie that Mr Lasenia Qarase has the constitutional right to run both as leader of the SDL or as individual member of our parliament.
    I voted for his party-SDL- in the last 2 elections and intended to do so again in the next one, cause i respected him as a person and i believe in what he was trying to accomplished in getting Fijians involves actively in the economic life of our nation.
    Mr Qarase is a self accomplished individual and a very honourable genetleman at that- too.
    He is a true statesman and i am sure if he is asked to step down for the sake of our country, he would do it in a minute! I don’t have any problem with MR. Qarase running as leader or member of the SDL next administration, but the only problem is with the IG and its leaders. How do we get rid of Poreqe and his cohorts is the question?
    Seems to me that he is not going to be stepping down real soon and as long as the economy is still limping along, the man is not going to give in to outside or internal threats and may be stupid enough to stick it out and willingly take the country down with him?
    Can we make a deal with this mad man to leave peacefully?Do we have time to wait him out? Must we let him destroy our economy,reputation and history?
    I’m sure that there already are, lots of smart Fijian Men and Women, in circulation,in Fiji as well as abroad with high academic qualification, who are currently ready to step into Mr Qarase shoes and take our nation to another level of higher progress and developments?

  7. kaiveicoco Says:

    does Frank understand anything at all about these economic meltdown?

  8. iceman Says:

    @kaicolo….We have mentioned time and again, when Voreqe speaks he does not even understand half if not most of the things he is talking about..sa qai yawa sara na economics…….The only solution…a bullet in his forehead, and we can have our democratic freedom back…..

  9. anon Says:

    iceman, i wish i have the resources, it is way, way too much….gggrrrrrr….

  10. Corruption Fighter Says:

    Will Frank survive devaluation? That’s the question the people pulling his strings must be asking themselves at the moment.

    When our dollar drops over the edge of the cliff there will be a lot of pain. The price of imported food and fuel will again sky rocket. The pain will be very real and there are no prospects of wage increases to pay for it. And repayments of government loans overseas will need more Fiji dollars to make the payments on them and that means less funds for the Government to use to pay for anything else.

    However devaluation won’t scare off investors. We haven’t got any investors to scare off and that’s one of the reasons why devaluation is inevitable.

    Moody’s the international rating agency, are reading the same signs and they’re about to downgrade Fiji’s rating to a level that will effectively mean we can only borrow from greediest of international pawnbrokers. Forget the World Bank and the ADB (ANZ and all of our other friends in the international community have seats on the boards of the international aid backs).

    When all hell breaks loose with prices rising and more cuts to government services, will the Military Council decide to bench the Commander? No-one can stop them if they want to do that.

    They have the control of armed force and they have the doctrine of necessity to tell them they have a right to use force. Forget the President. The Military Council would have no difficulty proving to any court that he was unable to act.

    Corruption Fighter

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