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Bad for Business

Of all the damage that 5 years of being governed by our self-appointed PM, JV Bainimarama, none is more serious than the damage done to business. Investment is at an all time low because business lacks the confidence to either borrow or invest their own money when they have never been sure that their investments are protected by the rule of law.

Laws are invented on a daily basis. In the name of reform, legally established rights are abolished by decree. News Limited’s ownership of The Fiji Times was abolished at the stroke of the President’s pen on a Sayed-Khaiyum decree. Air Pacific’s joint venture with Qantas, which dragged Air Pacific back from the brink of bankruptcy was likewise dissolved by decree.

These and many other high-handed actions have destroyed the confidence of all but Chinese companies, who feel that the Bainimarama Government is beholden to their government for aid.

The result can be seen in what’s called the excess liquidity of our banks. They all have money sitting in depositors accounts which cannot be lent because there are not enough businesses willing to take extra debt to invest in Frank’s Fiji.

The Sayed-Khaiyum answer to this problem is to force Banks to lend, whether they want to or not. At another stroke of the pen, Banks in Fiji are going to be forced to lend 6 percent of their deposits to projects in agriculture and renewable energy, whether they have sound, secure projects or not. Bank of the South Pacific alone will be forced to lend $48 million this year. Next year, they’ll have to find more projects.

It sounds just like the old National Bank of Fiji post 1987 coup. Friends with dodgy projects line up for their share of the easy money. They know it’s a loan, and they’ll pay it back if they can, but….

Forcing banks to lend money like this is not the answer to the lack of business confidence; it will only make things much worse.

The real answer is restoration of the rule of law.

12 thoughts on “Bad for Business

  1. Very well said.

    Noone with real investments will want to invest in Fiji while this farce continues – it is a very sad, but very real fact of life at the moment where there is nothing coming into Fiji, except high interest loans from China. How miserable is that?

    The only recourse that the regime has to issue new decrees and taxes in order to attempt to fight off the growing deficit – but with a growth rate of 1%, the financial future of the nation seems hopeless.

    This is the problem with a regime that seeks to rule by decree – it smacks of immaturity and its’ constant fear of the people in pretends to “lead”.

  2. @Radioboci

    Despite the many hurricanes/flooding Fiji has done very well……

    So there is no investments in Fiji……………….hahahah

    Whats happening in Bua, the bauxite mines are all bushit ya ………..hahah

    The revamp of Gold Mines in Vatukoula is also all bushit………………hahhaha

    Sugar exports, although declining are also bull ahit……………………….hahahah

    All the dalo/cassava, pawpaw and many vegetables exports are also bull shit…..hahaha

    All the ginger exports are also bull shit………………………………….hahahah

    All the garments exports over $100 million are also bull shit…………….hahahah

    All the pine chips and timber exports …………………..are also bull shit……..hahaha

    Perhaps there are more than enough shits for Radiolucas …….to EAT now…..hahahah

    and the ever increasing tourists numbers to fiji………..remains a record

    Your mentality is amazingly………….poor

  3. The Fiji economy is in deep shit and no amount of spin will change that.

    The main cause of the shit is deep stick Bainimarama and incompetent officers of the Fiji military.

  4. @ Sai & RV

    I agree – Sai, I have a few goats to sell you, a bit expensive mind you, but one of the goats can write his own decrees!

    @ Laisa

    “For 2012, the government officially forecasts a 2.3% growth rate, though recent actual growth figures have been practically zero despite similar projections. The government’s year-end 2012 INFLATION forecast is 3.5%.”
    – US State Dept. Report, 2012.

    Aside from your ability to peddle the same “shit”, there seems to be little else you can promise for Fiji eh?

    With a GDP forecast for -6.5% (yes, a negative) – what sort of miracle new “shit” do you promise? Maybe the government can invent another new lie like the ‘clean up’ or ‘sugar reform’? Or maybe Aiyaz can try distracting people with another lie on how we need to have a Freedom of Information Law for Buses (maybe try peanut sellers? Taxis? maybe the Baigani growers?).

    Anything but the real truth eh?

  5. Radio Draunimoli.

    Boy what industry is NZ know for?

    Don’t confuse goats for Dairy Cattle but than again what is one to expect from imbeciles.

    May it is common in Fiji where goats and cattle are cross bred thus having a hybrid animal possible called goattle.

  6. @ Sai

    “goats and cattle are cross bred thus having a hybrid animal possible called goattle.”

    It truly is a fascinating life that you lead. So… Do you want to buy them both? I suppose you could try to breed a “hybrid” if you really want to. But I think it may take quite a bit of effort as they are both male.

    Actually, now that we think about it, there is a whole raft of incompetant regime appointees that you can have – just take the entire RFMF and put them on your farm to breed. Better that they mess about on your paddock, rather than destroying our nation eh?

  7. $699M worth of foreign investments expected this year

    Share $699M worth of foreign investments are expected to be generated into the country this year.

    Investment Fiji CEO Ravuni Uluilakeba said that this is expected from their anticipated 206 projects by December which is an increase of 7.5 percent in investments from last year.

    He said that from January to April this year a total of 51 investment proposals worth $211.8M has been recorded.

    Uluilakeba said that this is mainly from the tourism, services, wholesale and retail trade, manufacturing, agriculture and forestry sectors which are the major ones to boost our economy in the coming months and next few years.

    According to Uluilakeba, investment levels have been fluctuating in the last five years since 2007 which recorded $483.71M worth of investments with a decrease in 2008 and 2009 but it picked up in 2010 with $592.05M worth of projects.

    In 2011, the investment level was $466.M.

  8. @above

    Dream on you moron; no one wants to invest in Fiji under the current leadership.

  9. $699 million my arse. What from? $290 million bogus casino, $50 million FNPF funded GPH in partnership with PNG and what else? Approval for a project from FTIB does not mean it will go ahead. This has been the case forever but more so under this bunch of illegal numb nuts. In any event we need GDP growth of 8% just to prevent any further unemployment and that my friends is a royal pipe dream. Getting cheap tourists in on the back of a devalued dollar…. friggin joke.

  10. BSP made a big mistake buying out the Commonwealth Bank of Australia’s shares in Colonial National Bank. They got a good price and CBA got a haircut, but CBA had been around long enough to learn the lessons. CBA got into the CNB in 2000 and bought 51% control in 2006, when things looked good with the Qarase Government.

    In 2009 the CBA lost confidence in their bet and sold out to BSP. Since then you can be sure that CBA management is not losing any sleep, but not so for BSP. For them a lot of heartache and pain. I’ve heard they wrote to Bainimarama and told him that they were really pissed about what’s happened. They put their money in when the regime desperately needed to boost confidence in the economy and they think all they’ve got in return, is a kick in the balls.

    So how did the Government repay them. They’ve interfered in the banking sector of the economy in lots of ways. Costing the banks real money. The ban on charging credit card surcharges, which are allowed in a lot of other countries, is just the latest. They’re also as mad as hell about the policy of forcing them to lend to agricultural projects. Everyone who knows anything about Fiji knows that land is often a problem for securing agricultural loans, because leases on Fijian land are limited to 30 years. The current government has promised to increase lease terms to 99 years, but haven’t come out and declared this in black and white and even if they do will the regime be able to force landowners to comply. Just like in PNG, land is a touchy subject.

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