Australia props up Fijian budgetary requirements amid a shortfall of US funding for 90 days

Andrew Mathieson Published March 13, 2025 at 5.00am (AWST)

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Australian High Commissioner Ewen McDonald and Deputy Prime Minister Prof Biman Prasad at the official signing of Australia’s $72 million grant budgetary support. Image: Australian High Commission.

The Australian government is filling a shortfall in the Fijian budget, committing a further $50 million to boost the island's public financial management, to promote economic reforms, and to build climate and social resilience.

The sizeable grant is the first step towards offsetting the scrapping of billions in funding by Donald Trump's administration amid a 90-day freeze on aid to the Pacific as part of the President's "America First" agenda.

Australian Foreign Minister Penny Wong said last week auditors were assessing the losses of individual Pacific programs and have calculated the region is set to be around $US54 billion poorer.

The Australian fiscal support is for the current 2024-25 budget before Canberra will decide on further funding for another financial year for not only Fiji, but for the other 13 independent nations of the Pacific Islands Forum.

Australian High Commissioner to Fiji, Ewen McDonald, discussed the new funding deal with Fijian Deputy Prime Minister, Professor Biman Prasad, before both men signed up to the latest Vuvale partnership.

Under the continuation of the Fiji-Australian Vuvale partnership – Vuvale is the Fijian word relating to family – the ($FJ72 million / AUD 49 million) cash injection recognises the respect and reciprocity of a connection between the historically close Oceanian nations.

The funding follows previous grants dating back five years when Fiji's economy struggled to survive in the midst of the Covid-19 pandemic.

Professor Prasad emphasised the importance of the latest grant in facilitating vital reforms that will shape Fiji's economic trajectory.

"This support is crucial to help us implement reforms that will improve the efficiency of our public financial management, ensure sustainable growth, and provide services to our most vulnerable populations," he said.

Australia's support will enable Fiji to access vital resources for essential projects, including public health and education.

"We are proud to be Fiji's largest development partner and to work together on building a more resilient and prosperous future," Mr McDonald said.

This latest round of funding adds to Australia's past investments in this financial year, which included nearly $A200 million ($FJ280 million) in a range of social infrastructure initiatives and expanding renewable energy access.