tourist numbers over the same period in 2003. the industry has set itself a target of becoming a $ 1 billion industry in 2007. but there are signs that the scarcity of hotel rooms is already imposing a glass ceiling on future growth. it is therefore encouraging to see several hotel projects under way like the momi bay marriott, the denarau sofitel and the hilton. i think that we will need a lot more than these to expand the immense potential of our tourism industry. new industries over the years, we have seen the emergence of a number of industries, which have the potential to contribute significantly to our economy. mineral water is one such emerging industry. it has climbed to be the 7th gross foreign exchange earner for fiji in a very short period of time. its exponential growth is a result of aggressive marketing, innovation and vision in a very competitive global market. it is a classical model of what our industries can achieve globally. recently, natural waters of fiji has made additional investment to triple production to meet global demand. in summary, while growth up to now has been broad based, there are capacity constraints are starting to emerge and there are serious threats to some sectors that need addressing. medium term outlook what about the medium term outlook? in my view, this is where thediscussion becomes very interesting. we are growing at the back of domestic demand supported by a policy environment of higher government deficits and increasing borrowing from financial institutions. this policy environment was no accident. it was a deliberate package put in place to help us recover quickly after 2000. during this time, the government increased its budget deficits to above 5 percent of gdp. we, in the reserve bank, kept monetary policy very relaxed and allowed interest rates to drop to historical lows. this has led to buoyant credit demand. this expansionary policy package has worked extremely well and we have seen its fruits up to now. investment is growing, incomes are rising and employment is increasing. this consumption driven growth is not a bad thing and many large countries do use this channel to expand their economies. but on its own, it does not last in the long run for an economy like fiji. fiji is a small market relying on a few commodities for exports and heavily dependent on imports. to sustain our current economic performance under such an economic set - up, we must try to pay for our local spending out of foreign earnings. that means that we must export more. unfortunately, while tourism is booming, our exports of

for short - term economic gains. as global experiences overwhelmingly show, the price that we will ultimately pay will be extremely painful. we can grow sustainably if we let growth be export - driven. i have suggested that we embark on a national export drive. like what the tourism industry has done, we can set targets for our traditional exports and even new exports. we can then mobilise the necessary resources and efforts to reach those targets. this cannot be the drive of government only. to be successful, it has to be a collective drive of the government, the private sector, industry organisations and even trade unions. we in the reserve bank are examining several ways that we could help promote exports. first, the forward exchange cover is still available for imports associated with exports, not only of goods, but also services. second, we are re - assessing the credit export facility that we offer through the commercial banks to see if it can be more attractive to small exporters. third, we are studying the provisioning of export credit guarantee with the help of the adb. lastly, we intend to convene a conference of interested groups on exports in the new year following on from our successful inaugural symposium two months ago. there are some emerging areas of exports that we need to harness. anaconda 2, shot in fiji and released recently, is, i hope, a leading wedge of what fiji can offer in the audio - visual industry. i believe that there is potential for growth in the information and technology industry. we have seen an increase in back - office services. we are fortunate to have invested in the southern cross submarine cable, which offers more than enough capacity to cater for the growth in the it related initiatives. before leaving this issue, i just want to emphasise the important role of fiscal policy in creating the enabling environment for growth and stability. fiscal policy has a greater and faster impact on the economy, and the role of government in promoting sustainable economic development is extremely vital. government has reduced the fiscal deficit to 3. 5 percent of gdp this year and further reduction is planned in the medium term. such a fiscal stance will strongly support the long - term sustainability of the economy and keep debt at a moderate level. raising the level of growth maintaining macroeconomic stability does not necessarily mean that we should be contented with lower levels of growth. we can and we must raise the long - term potential growth rate of the economy while maintaining stability. the only way to raise the potential of the