eTN Asia/Pacific, december 8, 2006
For Fiji, which heavily depends upon tourism when it comes to propelling its economy, the coup’s adverse impact is resulting in alarming situation. Tourism is considered to be Fiji’s biggest foreign exchange earner.
“Now the industry worth about $700 million a year is braced for a backlash as tourists stay away as the military coup takes effect. The tourism industry employs more than 45,000 and makes up a quarter of Fiji's economy,” according to a media report.
According to Economist.com, tourism numbers are bound to fall off sharply as bookings are cancelled in light of the latest coup. On top of this, aid inflows are likely to be revised—and sanctions imposed—as Fiji’s neighbors review diplomatic relations with the military government.
Apart from tourism, the overall situation is getting adversely affected. The international rating agencies, Standard and Poors, and Moodys have put Fiji on negative credit watch as a result. It is being felt that the drop-off in tourism following the coup will add to Fiji’s existing problems, such as the declining sugar and garment industries. Meanwhile, the global bank Citicorp, says the continuing unrest means the next time Fiji’s government goes to the market for money, the interest rates will be much higher.
