##ommodative monetary policy settings, favourable labour market conditions and inflows of remittances and tourist earnings continue to boost consumer spending and investor sentiments. inflationary pressures in 2016 came largely from domestic supply side factors following the natural disasters. inflation going forward in the near term is expected to continue to be domestically driven with any major downside risks stemming from adverse weather conditions, but also any sharp increases in international oil and food prices. for now, year - end inflation is projected at around 2. 5 percent. with the modest performance of fiji ’ s external sector, foreign reserves levels remain adequate, currently at $ 1. 9 billion, which is sufficient to cover 5. 1 months of retained imports of goods and non - factor services. our financial system remains stable and continues to support the economy during this time of recovery. bank lending has been reported at sustainable levels after a period of aggressive growth in the last 5 years. non - performing loans as an indicator of the soundness of our financial system have been recorded at all - time lows. the performance of the insurance industry continues to be assessed as satisfactory even though the 2016 results of the general insurance sector will be significantly impacted by claims arising from the tc winston insured losses. notwithstanding the current stable assessment of our economy, the reserve bank will of course continue to closely monitor global and domestic developments and assess likely vulnerabilities that may negatively impact our growth and the stability of our financial system. closing in closing ladies and gentlemen, i take this opportunity to again acknowledge free bird institute limited for its strategic vision and perseverance towards achieving its listing aspirations. i congratulate mr taniguchi, the board and staff for reaching this milestone in the company ’ s journey in fiji and wish you well as a listed entity. ladies and gentlemen, i cannot leave you without making my usual regulatory statement to urge all potential investors to take the time to carefully peruse the offer document that has been prepared for this listing. please ensure to conduct your own analysis and do seek professional advice from licensed investment advisers or stockbrokers on the suitability of investing in the stock market as per your objectives. with that said, i now have much pleasure in officially declaring free bird institute limited as listed on the south pacific stock exchange. arigato gozaimasu! vinaka vakalevu! end.

current economic background – the rbf remains committed to its twin objectives – that is to maintain low inflation and an adequate level of foreign reserves. inflation has been high at the moment and reached 10. 4 percent last bis central bankers ’ speeches month. as we all know, the inflation outcome has been influenced by external and policy related factors – most of which are beyond the control of monetary policy. imported inflation alone accounts for more than 60 percent of our domestic inflation outcome. with the current demand side inflationary pressures weak at the moment, it is more appropriate that monetary policy remain accommodative to support some growth in the economy while at the same time vigilant on the potential second - round impact on inflation. inflation is forecast to subside to 7 percent by the end of this year and further to 4. 5 percent by the end of next year. b. on to core inflation – in principle monetary policy should only respond to persistent price movements. the reserve bank has two core inflation measures which are the trimmed mean and excluding food and energy items inflation, both are widely accepted and used in many central banks to exclude temporary price pressures. universally, it is hard to determine when that “ temporary ” impact will come to an end as there are a lot of factors that come into play at almost the same time. in fiji, the big increase in food inflation from june 2010 to june 2011 to 11. 3 percent was attributed to many factors. if we compare food inflation from june 2010 to december 2010, food prices only rose by around 2. 0 percent which can be regarded as quite stable. as such most of the increase in food inflation only came about this year on account of the vat rate change and the high food prices noted across the world during this period. by january 2012, we should see the impact of vat fall from the core inflation measure. as to the impact of high world food prices, as soon as prices of these food commodities normalise abroad, core inflation should return to normal levels. c. it was mentioned that fiji had high rates of inflation by the middle of this year even after accounting for the impact of higher electricity tariffs and the increase in vat which came into effect in november last year and january this year respectively. it was also mentioned that seychelles which despite having a larger devaluation managed to bring down inflation to the same rate as vanuatu. it is important to note that unlike seychelles, fiji ’ s major trading partners are australia and new zealand which are