Indeed, he was convinced that the public good of financial stability also needed to be provided at EU level, and that would have necessitated the creation of an EU supervisory framework. At Maastricht, the Member States could not agree on this.
•  Strength 1: Low external debt  2  o  Government external debt has been on a declining trend since 1999 and was around 3.6 percent of GDP or 6.8 percent of total Government debt by 2005  o  This declining trend in external debt has also led to lower debt servicing commitments over the years with debt servicing ratio at 0.5 percent  o  International bond issue by Government:  BIS Review 94/2006  •  •  •  This was to finance government capital projects and avoid crowding out the private sector at a time when liquidity conditions are tight    With very low external debt, there is much room for government to diversify its sources of borrowing externally    Requirement of $ million    Fiji received a Ba2 rating by Moodys and a BB rating by Standard & Poors – reflecting a stable outlook for the Fiji economy    Results: 5 year tenure; initial price guidance of 7.25 percent was announced; 10 times oversubscribed $ billion); finally priced with a coupon rate of 6.875 percent to yield 7.000 percent    This very successful debut bond issue reflects confidence in the Fiji economy  Strength 2: Low inflation o  Inflation in Fiji has been low, averaging around 3 percent over the last 10 years  o  Reasons for low inflation:   Fiji has a fixed exchange rate that serves as an anchor on prices    Wage demands are relatively modest    Good inflation management is practised by our major trading partners all of whom either explicitly or implicitly target inflation    Good supply conditions for local market produce  Strength 3: Robust tourism sector o  The tourism industry is currently being touted as Fiji’s flagship industry, with future prospects looking very bright  o  Fiji has been able to attract significant investment through this industry from major international hotel name brands  o  Other supporting factors for this growing sector are:  o  •      Increases in airline seat capacity with Air Pacific    Introduction of low cost carriers    Development of new markets  This industry has also spurred growth in other sectors like the wholesale and retail trade and building and construction  Strength 4: Strong and stable financial system o  Independent central bank  o  Sound financial system  o  Favourable report from the Financial Sector Assessment Programme conducted by the World Bank/IMF  o  Financial Intelligence Unit has been set up  o  Development of a Real Time Gross Settlement System  Strength 5: Sustainable political stability o  BIS Review 94/2006  2 elections since 2000 and both were declared free and fair by international observers  3  4  o  Formation of a multi party cabinet  o  Strong investor and consumer confidence  o  Affirmative action policies are addressing the needs and concerns of the marginalised and disadvantaged  o  Clarification of the role of the military  BIS Review 94/2006