The Fiji government’s 2008 ‘budget for hope’ rests on some fundamental assumptions: political stability, the recovery of key sectors of the economy from the effects of the 2006 coup, as well as the recovery of the tourism industry, an industry which in the
past has been resilient to coups. With 34 per cent of the population already living below the poverty line, low economic growth could push significantly more people into poverty. If the increases in global food and fuel prices persist, creating even more difficulties for the poor, the prospect of social instability could heighten. In the absence of the expected recovery of these key sectors and the loss of skilled workers, achieving economic and social recovery will require political consensus to resolve the political impasse that has gripped the country. The Interim Government also needs to revisit its fiscal austerity package.