With over 110,000
confirmed cases in 113 countries and territories, the rapid spread of COVID-19
has today been declared a pandemic by the World Health Organisation. While Fiji
has so far remained coronavirus-free, we’re not immune from this pandemic’s economic
ramifications. 

The latest reports
estimate the net losses to the world economy will be upwards of two trillion
dollars this year, with global growth dramatically slowing to half of one
percent. The recent oil price war between Saudi Arabia and Russia has upended
global energy markets, throwing another wrench into an already-volatile
environment. Nations of all sizes are already facing the spectre of economic
recession.

The world economy
has not seen a threat of this scale since the global financial crisis. But
let’s remember, back in 2008, it wasn’t trade wars, tariffs or unilateralism
that pulled the world economy back from the brink. What proved successful was
an unprecedented, internationally-coordinated effort to refuel and re-spark
global growth. Once again, we must achieve the highest levels of global
cooperation and goodwill if we are to succeed in bringing badly-needed
stability back to our markets and economies.

Here in Fiji, our
situation demands extraordinary actions to minimise the brunt of the global
economic downturn. We cannot risk waiting until the close of the financial year
to re-evaluate our spending priorities and take stock of our revenue streams.
There are key expenditures that must be made to ensure the protection and continuation
of the Fijian way of life, that includes our people’s health, their jobs, their
businesses and their food security. Fiji is fortunate to counter this crisis
from a position of historic financial strength on the back of our longest-ever
economic expansion. It is clear the time to act is now, that is why we’ll be
announcing a new COVID-19 Response Budget on 26 March.

We’ve already moved
quickly and decisively to prevent a large-scale outbreak of COVID-19 in Fiji.
As the risk of a global outbreak became clear, we cut off travel from mainland
China, Italy, Iran and South Korea and massively stepped up screening at all
ports-of-entry in the country.

We should all
applaud the Ministry of Health and Medical Services for their quick actions and
professionalism in handling our nationwide response effort. Our medical teams
are ready to identify, isolate and treat any case of the virus in the country
and do everything possible to prevent a widespread outbreak. We’ve already
allocated a number of unbudgeted expenditures to support our preparatory
efforts, including ordering thermal scanners to install at our ports-of-entry.

Tourism and
travel-related industries can be the hardest hit by a viral outbreak. Fear
surrounding the COVID-19 outbreak has meant many people are not travelling.
Accordingly, Fiji’s tourism numbers are down, and we can expect them to remain
muted for some time. This will have a serious short-term impact, as tourism is
the single-largest contributor to our GDP.

Global air carriers
are anticipating projected losses in revenue upwards of 100 billion dollars.
Our national carrier, Fiji Airways, has seen a serious drop in demand on many
of its international routes. Regional supply-chains across the Asia-Pacific and
globally have been eviscerated by the viral outbreak, with vital flows of goods
and labour disrupted or ended entirely. This has a direct impact on capital
projects around the world, and developing countries, particularly, will need to
look to new source markets outside of China. Lower frequency along shipping
routes, in particular from North Asia, will raise the costs of shipping for all
goods brought by sea, even to and from countries like New Zealand.

Fiji has built many
strong economic partnerships around our region and the world. If you look at a
nation like the Maldives, which is largely dependent on Chinese and European
markets, their tourism sector is taking a brutal beating, putting many of their
people’s livelihoods in peril. Luckily, Fiji is not overly-reliant on the
Chinese market –– we have a responsible mix of tourism markets to hedge against
isolated disruptions. There’s still tremendous potential in our tourism markets
in Australia and New Zealand – both of which do not have large-scale outbreaks
of the virus. To-date, Fiji Airways’ key routes to Australia, New Zealand and
North America are seeing healthy numbers. We will be actively exploring new
measures of support for our tourism partners to take full advantage of these
and other opportunities.

Over the past
several weeks, we have been meeting with business and industry leaders to
understand exactly how they are affected by and coping with this global
slowdown and supply-chain disruptions, and how we – as a team – can work
together, explore possible fiscal initiatives, remain resolute, and ride this
through.

As we’ve already
told many of you in-person, your government’s ears are open to listen and our
support is steadfast and assured. The team at the Ministry of Economy has been
in overdrive preparing a COVID-19 Response Budget. As we prepare, if anyone
would like to contribute to our planning, the Ministry of Economy will be
accepting electronic submissions over e-mail at Budget Consultation “at”
economy dot gov dot fj.

Rest assured, we’ll
be leveraging every channel of growth at our disposal to keep our economy
prosperous, keep Fijians employed, and keep our businesses afloat, all while
putting our people’s wellbeing first. Our economy remains under prudent and
responsible management –– we will not hesitate to make tough decisions with a
view towards our long-term economic prospects. It is vital our partners in the
private sector take a similar view of the future.

And just like in our
recovery from the global financial crisis, collaboration is key. Because while
nations are shutting their borders to travel, we must continue to work across
borders –– and each of us must play our part.

World leaders must
find ways to protect economies of all sizes, and not play games of economic
nationalism when lives and livelihoods are at stake. At home, we cannot
politicise this pandemic. We must remain objective without falling prey to
sensationalism.

Likewise, business
leaders must recognise their role in our economic resilience. Keep your people
employed. So long as it is safe and sustainable to do so, keep your businesses
running. This is a test of our perseverance that we must prove strong enough to
endure –– but know that your government will work with you in close
collaboration to support you and the Fijians you employ.

Government look forward to sharing more in-depth details on the measures we’ll be taking to respond to this situation in Parliament on 26 March.

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