$676.7 million domestic borrowing

Ministry of Economy (MoE)

Government will borrow $676.7 million from domestic sources in the 2022-2023 financial year.

According to the Ministry of Economy’s Annual Borrowing Plan report released on Monday, the domestic borrowing will be through the issuance of Fiji Infrastructure Bonds (FIB), Viti Bonds, and Treasury Bills (T-Bills). Government plans to issue a total amount of $666.7 million in FIB bonds for the FY 2022/2023.

“A total of 4 new benchmark bonds for the 10, 15, and 20-year maturities will be issued during the fiscal year and re-opening the same maturities within the quarter with set limits of $200 million for each benchmark,” states the report.

“The Government will float Viti Bonds in FY2022-2023 totaling $10 million which will be issued on tap and available for investment from the date of signed Prospectus until 12 July 2023.

“The net issuance of T-Bills has slightly increased in FY 2021-2022 to meet Government short term financial needs due to the pandemic. The maturity profile for T-Bills is less than a year with tenors of 3 months, 6 months and 12 months.

“Government will consider issuing short and medium-term bonds. This will support commercial banks to invest in bonds as the tenors match their investment horizon. Any issuance of the 2 – 5 year bonds will be announced in the market. Government will continue to issue bonds with longer tenors to reduce refinancing risk. This is evident from FY 2019-2020 where we saw increased bids for bonds with 20 year maturities compared to the 10-15 year maturities.”

The ministry says the Debt Management Unit will continue to consult regularly with market participants prior to all planned flotations.

“Quarterly meetings will be arranged with major stakeholders in the domestic market to gauge market sentiments towards recent and upcoming issuances and to obtain updates on the investment environment.”

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