Moody’s has changed Fiji’s outlook to stable from negative after an assessment found Fiji is improving governance and institutions strength, is continuing engagement with development partners that will drive continued progress on reforms that will add some economic resilience.
The new stable rating of B1 for Fiji was released by the rating agency on October 7th.
“The decision to change the outlook to stable reflects Moody’s assessment that risks to the credit profile are balanced,” said a Moody’s press release.
“On the upside, the recovery in the tourism sector is stronger than previously expected.”
“With the sector accounting for a significant share of the economy, this bodes well for the real GDP growth in the next few years.
“In tandem with the robust economic recovery, Moody’s expects the government to run smaller fiscal deficits, which will support a gradual decline in the debt burden.
“On the downside, moderating global and regional growth may weaken demand for tourism in Fiji and result in greater fiscal and external challenges than Moody’s currently expects.
“The associated financial assistance from development partners will also provide some stability to government debt affordability and contain government liquidity risks.”
Moody’s states a high debt burden also constrain the B1 rating.
