February 8, 2008

Economic Downturn for Fiji Continues

Expect prices to go up: Reserve Bank
07 FEB 2008

In the approaching months, higher global oil and wheat prices, together with the increase in bus fares and flagfall for taxis, are expected to fuel domestic prices, the Reserve Bank of Fiji says.

Currently, the Brent Crude oil prices have eased to around $US 87.00 per barrel.

However, given the volatile and fickle pricing of this commodity, soaring crude oil prices remain a threat to inflationary outlook, the RBF says in the latest economic review.

In 2007, inflation was 4.3 per cent, underpinned by higher prices of alcoholic drinks and tobacco, clothing and footwear, miscellaneous items and durable household goods.

The increases were partially due to the upward revision in excise duties on these items, in line with announcements in the 2008 National Budget.

Moreover, food prices accelerated on the back of higher prices of bakery and wheat products, fresh meats, fish, dairy products, fats and oils and market items.

Over the month to December, consumer prices rose by 1.0 per cent.

Fiji households record lower incomes
07 FEB 2008

Households recorded lower incomes in 2007, suggests Reserve Bank of Fiji.

In 2007, net value added tax collections declined by 1.0 per cent on annual basis.

“Pay As You Earn collections also fell by around 1.0 per cent in 2007 on an annual basis suggesting lower household incomes.”

In the latest economic review, the RBF says consumption remained subdued in the review period, evident by declines in partial indicators of consumer spending.

Cumulative to November 2007, remittances declined by 27.3 per cent when compared with the same period in 2006, contributing further to subdued consumption activity.

Fiji building sector down 31pc
07 FEB 2008

Latest statistics on the building and construction sector indicate that the total value of work put in place cumulative to the third quarter totaled $165.4 million.

This was an annual decline of 31.7 per cent.

By categories, in the year to Quarter 3, the value of work put-in-place by the private sector fell significantly by 28.6 per cent with the public sector recording a much stronger decline of 44.6 per cent, the Reserve Bank of Fiji says.

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