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Is the twin deficits hypothesis relevant to Fiji?

Jayaraman, Tiruvalangadu K. and Choong, C.K. (2007) Is the twin deficits hypothesis relevant to Fiji? Fijian Studies: A Journal of Contemporary Fiji, 5 (1). pp. 1-27. ISSN 1728-7456

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Fiji has been experiencing current account deficits in its balance of payments since the late 1990s, despite the emergence of a boom in remittances. The deficits have become increasingly more pronounced since 2001 due to a decline in the country's traditional exports of sugar, a sharp fall in the exports of garments following the expiry of the Multifibre Agreement, and a decrease in the exports of gold following operational problems. On the other hand, there was a surge in imports of capital goods and machinery for the building and construction industry, due mainly to expansionary fiscal policies pursued by the government since 2001. Additionally, a steep rise in private sector credit in the post-coup years of 2000 ensued, contributing to a further widening of current account deficit. This paper seeks to investigate whether the popular twin deficit hypothesis is relevant in the case of Fiji.

Item Type: Journal Article
Subjects: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HG Finance
Divisions: Faculty of Business and Economics (FBE) > School of Economics
Depositing User: Ms Mereoni Camailakeba
Date Deposited: 26 May 2007 21:27
Last Modified: 25 May 2012 05:43

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