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  1. Nik Soni
    Nik Soni October 1, 2013 at 2:27 pm

    Biman & Nilesh,

    I could not agree more. Several years ago several of us (including Prof Prassad here) argued that Fiji’s economy was not as fragile as some in the international community had hoped for / wished. The belief that the Fiji economy would imminently collapse (thereby taking the regime with it) was a bizarre hope / brief that it was almost impossible to argue against in the capitals of Canberra and Wellington even if you had facts on your side.

    Similarly, the Fijian economy is not as secure as some would believe now either. Your paper and blog correctly highlight several vulnerabilities. In addition is the lack of foreign capital. The challenge with asian investment seems to be that the cash somehow never ends up in your country – a phenomenon seen in many Pacific Islands. So as a result the NFA and therefore exchange rates can be vulnerable.

    It is true that many are simply waiting the election and foreign largess that may come with re-integrating into the international community – but it must always be borne in mind that Fiji is a very open economy. If Asia and Australasia slow down at the same time the structural faults highlighted by the authors could cause significant financial and economic problems.

    You chaps are right – there is a need to keep a close eye on poverty (and I would suggest inflation) as they may give a better picture of what is happening on the ground.

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