Bula vinaka and a very good morning to you all.
There’s an old proverb that we have also embraced in Fiji: “If you want to get rich, first you have to build roads”.
I used this proverb three years ago in my national budget address announcing the biggest ever investment by any Fijian Government in our national road network. And I note that my friend the Chinese President, Xi Jinping, used the same quote last year at the APEC summit. When China and 20 other Asian nations signed a memorandum of understanding on the Asia Infrastructure Investment Bank – China’s answer to the World Bank.
It’s an acknowledgement that no nation can prosper if it doesn’t have adequate roads and all the other national infrastructure needed to develop a modern nation State. Which is why I’m delighted to be here in Malta – with Fiji now back in the Commonwealth – for this Commonwealth Business Forum with its theme “ Investing in Infrastructure: Building for the Long Term”.
Can I first thank Lord Marland Odstock, the Chairman of the Commonwealth Enterprise and Investment Council, for his invitation to be part of this event.
As I look around the room I realise that this is the great strength of the Commonwealth – not only its diversity and resilience but its importance as a place of learning. The independent nations that were once part of the old British Empire still able, in the new millennium, to come together to swap experiences and discuss our common challenges. And above all, how to build the solid economic foundations needed to provide sustainable and prosperous futures for our people.
Like many of you, Fiji sees the development of our national infrastructure as the key to unlocking our economic potential. And it has been a mainstay of the comprehensive reform program we have put in place to transform our economy and unlock the potential of the Fijian people.
First, we had to upend the existing political order that had kept Fiji in a state of perpetual division and arrested development since our independence from Britain in 1970. Our revolution cost us our place in the Commonwealth for five years and fractured some of our traditional relationships. But we make no apology for it. Because the Fiji that has emerged from that process of radical change is one of genuine opportunity for every citizen, whatever their background. And our new Constitution provides us with our first genuinely democratic blueprint.
For the first time, we have a Parliament elected on the basis of equal votes of equal value instead of being skewed through an electoral system that divided us Fijians on an ethnic basis – a legacy of our colonial era. We now have common and equal citizenry and, just as important, a common identity. Every citizen is a Fijian for the first time. And our Constitution also provides for an unprecedented range of social and economic rights that are empowering every Fijian, apart from the usual civil and political rights.
So we are finally a genuine democracy. A better and true democracy. And we can now proceed in earnest with another pillar of our reform program – the transformation of our economy to improve the lives of all of our people. To finally fulfill the great promise Fiji had at Independence that we squandered over the years as we argued about rights for some of our citizens rather than rights for all, as we delved deeper and deeper into systemic corruption. We continued to argue over parochial matters driven by elitism, cronyism and communalism. We could not move forward together as one nation, one people.
I’m pleased to report that our new political order – our new direction, our prudent economic management and our new Constitution – has unleashed one of the greatest periods of economic growth in our nation’s history. Last year, the Fijian economy grew by 5.3 per cent – eclipsing our larger neighbours. And we are on target to achieve a record sixth consecutive year of growth this year.
We are also riding an investment wave amounting to 25 per cent of GDP in the past two years, with a similar forecast for 2015. Currently, 75 per cent of this investment is by the private sector. But only a few years ago, the bulk of the investment was from my Government’s program to invest in infrastructure. That focus on investing in infrastructure is being maintained. Indeed, 40 per cent of government spend is on building infrastructure and State assets.
We are putting an end to the years of neglect. Of poor roads or no roads at all. Ports that were slow and inefficient. Large areas of the country without access to electricity and clean water. And much of our physical infrastructure crumbling – such as our capital’s water supply – because too much of it dated back to colonial times and too little had been done to maintain it.
Mr Chairman, all that is steadily being reversed. And Fiji is now a case study of the benefits of governments embarking on a responsible program of fiscal expansion to fund infrastructure development. As stated, Government capital expenditure has increased from an average of 19 percent in the period 2001 to 2005 to 40 percent of total government expenditure in 2015.
As I keep telling our people, we are borrowing not like previous governments to fund our day-to-day expenditure but to lay the foundations for the economic expansion that improved infrastructure brings. In doing so, we are unleashing our nation’s potential and the potential of our people. And also making Fiji a much more attractive destination for the global investment community.
We have already seen a sharp rise in confidence in the domestic private sector and among foreign investors. New bank lending for investment purposes has risen by nearly 95 per cent. And imports of goods for investment – excluding aircraft – rose by 7.2 percent to June 2014 – the most recent figures available.
So Mr Chairman, Excellencies and delegates, Fiji is on the move. Fiji is open for business. And all over the country are the signs of progress. In the two years since 2013 – when we began our infrastructure spending program in earnest, our total spending on roads and bridges has amounted to more than 1.5 billion Fijian dollars. This has been directed at upgrading our existing highways and the vital access routes to markets – our nation’s arteries; building new roads where they are most needed and this includes a focus on building and maintaining rural roads. It means unlocking the economic potential of our main northern island of Vanua Levu; building new jetties and repairing existing ones in our many maritime communities; and constructing a new four lane highway from our main airport in Nadi to our biggest holiday playground – Denarau Island – a mainstay of the tourism industry that is Fiji’s biggest revenue earner.
All this means faster travel times and better and more efficient transportation – a vital building block in any economy. Attracting more investment. Creating more wealth. And we intend to continue this program next year – with a further investment of 635-million dollars – as well as making our roads a spending priority for many years to come.
Mr Chairman, it is vital that smaller nations realise that major improvements in infrastructure require outside involvement – partnerships with foreign companies capable of providing the required expertise. So to upgrade our roads, we issued contracts to road building specialists from New Zealand, China and Malaysia.
Some critics have said “why can’t we use our own people?” But the simple truth is that during the years of decline in Fiji, we progressively lost the ability to build decent roads ourselves. In fact, our old Public Works Department had become so inefficient and corrupt that we simply shut it down altogether. Now the Fiji Roads Authority – which commissions roads but doesn’t build them – works with our foreign partners, who use local workers and are gradually passing on their expertise.
In doing so, we are rebuilding our own road-building skills and also learning how to better maintain road surfaces in our harsh tropical conditions. But the lesson from this is that xenophobia is the enemy of efficiency and infrastructure development. If you can’t do it properly yourself, get someone else from outside who can. And ride them hard to produce the best possible result and to ensure that skill sets are passed down to the best qualified locals. This public-private partnership, this foreign–domestic partnership is the model we have adopted in Fiji and is contributing to our success.
Mr Chairman, we have a vision of Fiji exploiting its position at the crossroads of the Pacific to establish ourselves as a genuine trading hub. Goods flowing through Fiji to the rest of the region from outside. Goods flowing from the region through Fiji to the rest of the world. And Fiji at the centre of it all as a vibrant manufacturing base and producer of its own goods and services – the Fijian-Made brand a byword for quality and consistency the world over.
Yet no nation can compete effectively in the international marketplace unless it removes the impediments to trade. So the reform program in our ports is another key component of our infrastructure development. Before these reforms, some shipping companies either bypassed Fiji altogether because of slow turnaround times or charged exporters a surcharge to cover the extra cost caused by these delays.
It wasn’t just a poor work ethic on our wharves but outdated machinery and equipment that was producing congestion. Our main ports were clogged and we desperately needed to unclog them. So we again looked overseas for a partner with world class expertise to assist us with the reform process. And again, our Fiji Ports Corporation entered into a successful partnership with the Sri Lankan company, Atkins Spence – a “top 200” Forbes company.
With a brief to urgently address the bottlenecks at our two main ports of Suva and Lautoka, Atkins Spence has helped us increase productivity by 30 per cent. There has been a marked improvement in vessel turnaround times thanks to new work practices and new machinery, with consequent falls in the cost of doing business for our importers and exporters.
It has also added value to this important public asset. And to enhance efficiency even more, the Government recently divested 59 per cent of its shares in the Fiji Ports Corporation and raised more than 100-million Fijian dollars.
Mr Chairman, our concept of Fiji as a Pacific hub extends to aviation. And Airports Fiji Limited is spending 250-million dollars in the next five years to upgrade Nadi International Airport – our main point of entry – and other airports to bring them up to international standards.
This is on top of the major investment we have made in our national airline – Fiji Airways – equipping it with three state-of-the-art A330-200s plus a fourth A330-300 that I will be taking delivery of from the Airbus Company on the 14th of next month. This investment in new, fuel efficient aircraft has been a major contributor to Fiji Airways announcing its biggest ever pre-tax profit last year of 60-million Fijian dollars.
Mr Chairman, Excellencies, delegates, I am happy to announce that from April of next year, Fiji Airways – our national carrier- will commence direct flights to Singapore. This now means that our national carrier will fly to every single continent that borders the Pacific Ocean except South America. This is an opportunity obviously to explore in the next few years.
Mr Chairman, Excellencies, delegates, as you all know, investing in alternative energy sources is very much on all our minds in the lead-up to COP-21. Fiji and the other island nations are going to Paris taking with the Suva Declaration calling on the industrialised nations to cap global warming at 1.5 degrees celsius above pre-industrial levels rather than the 2 degrees currently envisaged.
Fiji’s own contribution to carbon emissions are a meagre zero point zero,zero four per cent (0.004%) of the global total. Yet we are still committing ourselves to reducing that by 30 per cent by 2030. And to do so, we intend to make a heavy investment in alternative energy infrastructure to reduce our dependence on fossil fuels to just 1 per cent of our total energy needs.
Our total fossil fuel bill at present – largely because of our reliance on diesel to generate electricity – amounts to more than one-billion Fijian dollars a year. So we intend to invest further in renewable energy sources – hydro-energy and solar power – to take this from 60 per cent at present to 99 per cent in 15 years.
In our opinion, far too many Fijians still don’t have access to electricity. So we have spent nearly 30-million dollars in the past two years extending the national grid to rural areas, installing solar systems and wiring people’s homes. Our infrastructure spending in this area is also being directed to renewable energy sources – including a new hydroelectric dam on Taveuni – our third biggest island – and similar alternative energy schemes in several of our maritime communities.
Access to clean water is also a socio-economic right under our Constitution. We have invested unprecedented funding in upgrading our archaic water systems and are giving water access to those Fijians who were drinking from creeks, rivers and wells. This unprecedented and focused investment of ours has attracted international attention. Only a few weeks ago, the Green Climate Fund approved a grant facility of US$31 million to assist in upgrading our urban water reticulation system.
Mr Chairman, finally, I refer to our infrastructure investment in ICT – Information and Communication Technology. Which I’m sure everyone agrees is essential for a modern internationally competitive economy. And here again, Fiji has become the Pacific’s ICT hub.
In the last annual review by the International Telecommunications Union of the delivery of ICT infrastructure and services to the populations of more than 150 countries, Fiji tied for the third largest improvement of any country, moving up five places to 88th. The ITU attributed Fiji’s high ranking to strong growth in mobile broadband penetration; the extension of 3G coverage to 95 per cent of the country; the development of the Pacific’s first national broadband plan; a commitment to making Internet access affordable; and the expansion of e-Government services – putting the functions of the State online. This includes a new Online Single Window Clearance System for potential foreign investors. This allows them to gain some of the necessary approvals to set up businesses in Fiji from a range of regulatory authorities through one Internet site accessed from anywhere in the world.
Fiji has liberalised the telecommunications market and introduced actual competition for the first time. This has driven up access to mobile services and made mobile connectivity more affordable. So we are ending the isolation of our people, broadening their horizons and empowering them in a way that previous generations could never have imagined.
This includes the provision of 26 Telecentres throughout the country – mainly in rural schools – to provide free access to Internet and other communication services to almost 40-thousand ordinary Fijians thus far – students during school hours and the wider community in the evenings and on weekends.
We have also increased our funding to our national broadcaster to extend public broadcasting in both radio and television. This is to ensure that all Fijians have access to information. This investment has been further enhanced by the generous assistance of the Japanese Government in rebuilding our AM frequency outreach. We will now be able to broadcast to all far flung parts of Fiji and I am told that on a good day, you will be able hear us in New Zealand and in Tonga!
So Mr Chairman, Excellencies, Ladies and Gentlemen, these are just some of the ways that Fiji is benefiting from its investment in infrastructure, which, of course, goes hand in hand with investing in the education and training of our people. I always say that my Government’s proudest achievement is to have introduced free education in our primary and secondary schools for the first time. Along with providing more access to higher education with an expanded program of scholarships and tertiary loans for our people to gain skills at our universities and technical colleges.
As you all know, effective governance requires a holistic approach to development. And there is little point in meeting the respective infrastructure needs of our nations without also investing in the people who use that infrastructure. So we have set ourselves the goal in Fiji to become more savvy and clever to match our infrastructure needs with the need to develop the full range of services and opportunities to ensure that all Fijians and Fiji prospers.
Mr Chairman, Excellencies, Delegates, these are exciting times for Fiji and I feel privileged and proud to have had the opportunity to share some of our vision with you. Now back in the Commonwealth and strengthening our engagement with the global community across a broad front, I urge as many of you as possible to visit Fiji when you have the opportunity, not only to see this progress for yourselves but to enjoy the beauty of our islands and experience our world famous Fijian hospitality. Because our people are our greatest asset of all.
Vinaka vakalevu. Thank you.