Question 1 Reference is made to the Revised 2021-2022 Fiji National Budget announced on 24 March 2022. The Government ac
Posted: Thu May 19, 2022 1:50 pm
Question 1
Reference is made to the Revised 2021-2022 Fiji National Budget
announced on 24 March 2022. The Government accessed Phase two of
the COVID19 Crisis Response Emergency Support Loan from JICA JPY10
billion (FJ$176.8 million) at concessional terms, with a 15year
repayment period inclusive of a 4 year grace period amounting to
the period at 0.01 percent interest rate. The first phase of the
program also amounted to JPY10 billion (FJ$187.4 million) and was
accessed in FY2020 year grace As at 2021. Total Expenditure in the
Revised Budget is estimated to be $3.72 billion and Total Revenue
is $2.25 billion. The total deficit will be $1.46 billion. Debt is
projected to reach 88.6 percent by the end of this fiscal year and
based on the projected economic recovery and planned deficit
reduction, the Debt to GDP ratio is expected to come down to below
80% in the next 3 years. Required: Assume your role as an Economic
Advisor to the Fijian government,
(i) Explain the relevance of JICA concessional loan facilities
to the Fijian economy.
(ii) Should government explore more of such facilities in coming
years, Why or why not
(iii) Suggest one alternative to such facilities.
(iv) Suggest two strategies to achieve the desired Debt to GDP
ratio in the next 3 years.
Reference is made to the Revised 2021-2022 Fiji National Budget
announced on 24 March 2022. The Government accessed Phase two of
the COVID19 Crisis Response Emergency Support Loan from JICA JPY10
billion (FJ$176.8 million) at concessional terms, with a 15year
repayment period inclusive of a 4 year grace period amounting to
the period at 0.01 percent interest rate. The first phase of the
program also amounted to JPY10 billion (FJ$187.4 million) and was
accessed in FY2020 year grace As at 2021. Total Expenditure in the
Revised Budget is estimated to be $3.72 billion and Total Revenue
is $2.25 billion. The total deficit will be $1.46 billion. Debt is
projected to reach 88.6 percent by the end of this fiscal year and
based on the projected economic recovery and planned deficit
reduction, the Debt to GDP ratio is expected to come down to below
80% in the next 3 years. Required: Assume your role as an Economic
Advisor to the Fijian government,
(i) Explain the relevance of JICA concessional loan facilities
to the Fijian economy.
(ii) Should government explore more of such facilities in coming
years, Why or why not
(iii) Suggest one alternative to such facilities.
(iv) Suggest two strategies to achieve the desired Debt to GDP
ratio in the next 3 years.