Large contractions in credit to key sectors of Fiji’s economy resulted in a 0.2 percent decline in commercial banks’ credit over the year to April, compared with a growth of 10.2 percent in the same period last year, according to the Reserve Bank of Fiji’s latest monthly economic review.
The RBF’s review for the month ended May said that consequently, overall private sector credit growth slowed down to 0.5 percent in April compared with a growth of 8.7 percent a year ago.
The contractions in credit were to the public enterprises, manufacturing, professional and business services, private individuals and the agriculture sectors.
According to the RBF’s April economic review, in the year to February, total commercial bank lending rose marginally by 0.1 percent, compared with an 11.6 percent increase recorded in the same period last year.
That slowdown was also attributed to a contraction in lending to the same sectors.-Source: Fijilive.com
Editor's Note: It's really bad news. It means that there is no new activity taking place in the economy. Existing businesses lack the confidence to expand and potential investors are backing off for the same reason. But what the RBF won't tell us is the amount of money that has left the country in the same period. It's not hard to guess why they won't say.