December 8, 2009

2007 damage lower as GDP revised

December 08, 2009

The base year for Fiji’s Gross Domestic Product has changed from 1995 to 2005, affecting some of Fiji’s previously announced GDP figures.

The Reserve Bank of Fiji said that as a result, the real GDP growth for 2005 was 0.5 percent while the growth rate for 2006 is now estimated to be 1.9 percent.

In 2007, the economy is now estimated to have contracted by a much lower rate of 0.5 percent than the 6.6 percent decline that was estimated earlier under the 1995 base, the RBF said.

For 2008, the economy is now estimated to have declined marginally by 0.1 percent as opposed to the previous estimate of 0.2 percent growth.

New forecasts released as part of the 2010 Budget released this month indicate the economy is anticipated to contract by 2.5 percent this year and then grow at a rate of 1.9 percent next year, the RBF said.

“The change in base reflected transformations in the structure of the economy from 1995, the previous base year, to 2005. Over this period, the weights of some sectors/industries would have changed while new sectors/industries have emerged.”

The figures were released by the Fiji Islands Bureau of Statistics.

RBF Governor Sada Reddy said 2009 was a tough year with the full impact of the global economy and the adverse effects of the floods passing through the economy.

He said that as a result of the weak economy, the current account deficit had improved to an estimated 8.6 percent of GDP from 17.7 percent in 2008.

Reddy reiterated the need to reduce the current account deficit to 5 percent of GDP in the medium term.

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