A COMMONWEALTH Secretariat mission has proposed several measures to improve the market for Fiji’s domestic bonds and treasury bills.
The team was in Fiji on January 18 and 19, 2016 at the invitation of the Ministry of Finance to assess the development of Fiji’s domestic bond market, and made a number of recommendations that could be implemented in the near-to medium term.
These, according to a Government statement, included a review of the auction procedure, dematerialisation of securities, reducing the number of bond series currently issued in the domestic bond market, and introducing bond buybacks and bond exchanges.
The team briefed the Attorney-General and Minister for Finance, Aiyaz Sayed-Khaiyum, on its recommendations and engaged in a dialogue on a broad range of issues relating to debt management.
“The Commonwealth team came at our invitation and has made several sound recommendations that we look forward to implementing,” said Mr Sayed-Khaiyum.
“The Ministry of Finance is already working on a number of measures to inject more transparency in our financial system and create a more mature system, with the goal of making Fiji a financial hub.”
The mission comprised Sanjay Kumar, adviser and team leader, Baudouin Richard, Briar Ferguson and Werner Rieke.
The purpose of the mission was to undertake domestic market development assessment and identify ways to create a liquid and deep market for Fiji’s domestic bonds and treasury bills.
This review should result in a promotion of a wider investor base for government securities, which should impart liquidity and price transparency and also, prevent possible market manipulation given Fiji’s narrow market base.
During its nearly two-week visit, the mission met officials of the Ministry of Finance, Reserve Bank of Fiji and Fiji National Provident Fund, as well as representatives from commercial banks and the financial sector.
The mission also benefited from the reports of other development institutions that have worked in the area of public debt management in Fiji.