o fiscal decisions have an immediate impact o the impact is also greater than monetary policy • while, the higher fiscal deficits in the past worked well to raise economic growth, we now need to relook at our strategy to secure sustainability 4. what can we do to raise economic growth? • we must have a consensus on growth and set ourselves as a nation an economic growth target • several recipes of achieving a 5 percent average growth are : • a. recipe 1 : we need to set targets in our key resource sectors b. recipe 2 : we need to raise investment to 25 % of gdp, especially through private sector investment c. recipe 3 : we need to accelerate reforms and not succumb to reform myths d. recipe 4 : we need to lift productivity this policy mix will : o sustain future prosperity o still raise growth to even higher level o create jobs o help us address social issues

democracy – political stability and reengagement of our development partners. as a result, consumption and investment activity have been very robust. this is confirmed by trends in the various partial indicators. improved disposable household incomes from lower taxes, government financial support and remittance inflows from fijians abroad continue to underpin consumer spending. the vehicle industry has clearly benefitted under this climate and this has been further supported by favourable labour market conditions, as reflected in growing numbers of newly registered members with the fiji national provident fund and job advertisements placed in the daily newspapers. bis central bankers ’ speeches investment activity has expanded and continues to grow with momentum from both the private sector and government. in recent years the government has allocated sizeable budgets for infrastructure development, which benefit both the public and private sectors and which will gradually unlock previously untapped resources across our major islands as our local entrepreneurs begin to play their part to develop their businesses. this year, despite tropical cyclone ( tc ) winston and the april floods brought on by tc zena, the fijian economy is still forecast to grow by 2. 4 percent. this growth reflects expected strong activity in our tourism - related industries, including transport, wholesale, retail, accommodation & food services, which were relatively unscathed by the cyclones. in addition, with the on - going reconstruction and recovery efforts, construction activity is expected to remain strong, further boosting retail sales activity. ladies and gentlemen, we know that imports of investment and consumption goods are projected to pick up as the domestic economy strengthens and reconstruction efforts postcyclones continue. when we couple this with expected lower exports of agricultural products as a result of the natural disasters, it is possible that we will see a small dent in our foreign reserves towards the end of this year. nonetheless, at the moment, our official reserves continue to remain comfortable, at just under $ 2. 0 billion, or enough to pay for 5. 5 months of retained imports. inflation, another key macro - economic indicator which we monitor closely, spiked in june to 5. 3 percent on the back of price hikes in local agricultural market items following the cyclones. this effect will be temporary, and in the near - to - medium term, we forecast inflation to be stabilised by the existing low world commodity prices. our end - year number for inflation is closer to 3 percent. the medium term outlook for the fiji economy is expected to remain positive. notwithstanding any further adverse shocks, our