Building Economy – Post-COVID learning and strategies

1. Productivity

One of the parameters of growth engine starts from improving the productivity of human resources. When human resources productivity improves, naturally machines will be managed well to deliver productivity in much better fashion. Nation progress one of the foundation pillar in “Productivity”. If the overall human productivity improves, nation capacity, revenue generation, trust on people ability, overall brand and perception of country improves. It is same like, when people get product from Germany or Japan, country of origin perception is extremely high compared to any other nations. The reason being, these countries worked hard to establish their brand name as quality product with their dedication, commitment and delivering final product with absolutely zero-defect ratio. According to most of generic research, definition of “Productivity is commonly defined as a ratio between the output volume and the volume of inputs. In other words, it measures how efficiently production inputs, such as labour and capital, are being used in an economy to produce a given level of output”. Productivity is not related to how many hours person work, but how fast and reliable delivery output he/ she can deliver as end user satisfaction. Productivity of Fiji is better than most of the pacific nations. However, when Fiji is establishing to compete and have a dream and aspirations to become “Pacific Hub”; it is equally important to improve productivity in overall sector and dimension. The popular phrase in Hindi “Din Maro” commonly used need to be transformed. Meaning of “Din Maro” means kill the time. This will not help any of us. Every minute we have been given by Almighty God, need to be productive. Whether it is work, leisure, rest or whatever human being do.

According to Paul Krugman, The Age of Diminishing Expectations (1994) “Productivity isn’t everything, but in the long run it is almost everything. A country’s ability to improve its standard of living over time depends almost entirely on its ability to raise its output per worker”.

Productivity is accentuated as a major source of economic growth, competitiveness and ability to pursue. As per the economic theory, productivity data are used to investigate the impact of product and labour market regulations on economic performance. Productivity growth constitutes an important element for modelling the productive capacity of economies. This data further helps analysts to determine capacity consumption and utilisation, which in turn allows one to assess the position of economics in the business cycle and to forecast economic growth. In addition, production capacity is used to assess demand and inflationary pressures of the particular market.

Each economics leaders and professionals use various measures of productivity and the choice between them depends either on the purpose of the productivity measurement and/or data availability. One of the most widely accepted and used measures of productivity is Gross Domestic Product (GDP) per hour worked. This system captures the use of labour inputs better than just output per employee. This also reflects the current resources provided and how they harvest the resources to improve the productivity. The source or benchmark for total hours worked is the “The Organisation for Economic Co-operation and Development (OECD) Annual National Accounts database, though for a number of countries other sources have to be used. This is very cumbersome process to collect, analyze, evaluate and diagnose this huge data. Though now a days, data science with the help of technology is churning this data by using sophistical data analysis, through technology utilization like Block chain. Least developed countries and developing nations is major issue to deliver their authentic data. Despite the progress and efforts in this area, the measurement of hours worked still suffers from a number of statistical problems. Namely, different concepts and basic statistical sources are used across countries, which can hinder international comparability. In principle, the measurement of labour inputs should also consider differences in workers’ educational attainment, skills and experience. Accordingly, the OECD has started to develop adjusted labour input measures.

To take account of the role of capital inputs, an appropriate measure is the flow of productive services that can be drawn from the cumulative stock of past investments (such as machinery and equipment). These services are estimated by the OECD using the rate of change of the ‘productive capital stock’, which considers wear and tear, retirements and other sources of reduction in the productive capacity of fixed capital assets.

In summary, it is critical for Fiji to improve the productivity in overall human resources, which will be backed by skill, experience, education and overall optimum productivity. I like the concept of 80:20 golden rules, where a person who spend / invest 20% of time; cultivate 80% results gives huge boost to overall productivity. That means, productivity is not corelated to how many hours worker spent on the task. Some may work 80% of their time and only deliver 20% of output, which become very sluggish productivity. Whereas, a person who delivers 80% of results in 20% of time get sufficient time in hand. This remaining 80% of time can be invested in innovation, creativity, new thinking, new strategies and developing vision, purpose and objective for individual and organisation work.   

  1. Skill
  2. Competency
  3. Education
  4. Knowledge
  5. Experience
  6. Free Schooling

2. Education System

Education system in Fiji is day by day weakening. Students are not taking passionate interest in their study, where curiosity and critical analysis is lacking from students. Students are more focussed on grades than subject knowledge. This is making them parrot and there is no real value coming from either fresh graduates or even seasoned experienced people. Even while teaching MBA with education institutes, I observed, they are full time working community and doing part time MBA. Hence, they are not able to put required efforts to learn business. Eventually, every experienced community with MBA degree is not able to generate value of their investment to gain and polish their knowledge and skill at their working place.

Curiosity of learning need to develop from early childhood. Recently, in India, CBSE has collaborated with Microsoft to introduce Software Coding for classes 6-8 year and data Science curriculum for classes 8-12 year as new skilling subjects in the 2021 – 2022 Academic session. This shows, how India is gearing for technology driven society in coming years. This is where education policy of country needs to transform the foundation of education in line with future socio-economic dimension.

3. Free Education

It is time to make education free based on the economic criteria. Those families who can afford and financially sound, should be paying for their children’s education. When fees are paid, there is level of commitment, ability to achieve more, confidence level automatically goes high with children’s. I am not a great fan of free education. However, I strongly believe, the people under poverty line must get opportunity to get free education, so they can perform well with other societal structure. 

4. Experienced Fraternity

Good thing about middle management and even some of the juniors in various organisation have dream, aspirations and ambitions to climb on the corporate ladder. That is very positive and that’s where we need to help these younger population who are extremely ambitious. However, the sacrifices, hard work and sincerity in delivering results is big issue. The dreams and ambitions are possible through hard work, sincerity, putting extra efforts than others, appetite to learn new, building relationship with corporate world on long term basis. Unfortunately, juniors in corporate world build relationship on short term basis and when they have immediate need, the relationship building process begin with expectations. Unfortunately, this approach feels very self-centred. Hence, it is important to develop relationship with corporate world with a systematic journey of establishing blocks one by one. I met many corporate leaders, where they feel the juniors develop relationship to get instant benefits. Question is, why seniors in the corporate should support those selfish behaviour people.

Corporate world and culture of productivity in pacific is low, because of easy going attitude. If happens then all good, if not happening, still good. Which is not a bad attitude to make life simple. However, if person aspire and dreams, taking casual approach and attitude does not help to progress and eventually drop down in productivity.

Fiji got a great opportunity to grow in pacific, because of infrastructure and quality of students better than other pacific nations. However, it is not sufficient to compete and deliver high scale results with current productivity level. It needs some discipline, strong focus and habit to work more determined efforts.

5. Innovation

Most are replica products and services. Real innovation is lacking. Which can be either instant, sporadic or well-structured innovation mapping is required. There is nothing concrete new products or services coming from Fiji, where we can offer disruptive innovation. Traditionally, Fiji is inclined towards getting second hand concepts with products and services, which are already in global market. Innovation with risk goes hand in hand. Fiji government has taken some initiative to promote young budding entrepreneurs through their Young Entrepreneurship Scheme (YES). It is great initiative for any one to come with new innovative idea, concept and work on their project tirelessly to make it successful. There are some young generation, who took advantage of this scheme and running their business successfully. However, their products or services are not innovative to the world or even to the pacific, where they can harness the benefit of disruptive innovation theory. Replica product or services don’t achieve greater scale of business proposition. It may be considered; the dreams of these young entrepreneurs are very limited. They are not willing to spend sufficient time to develop some thing new. Innovation can happen based on need-gap analysis theory and come up with absolutely new innovative product or services, which can make them hugely successful in international market.

6. Shift in working hours

Increasing working hours from existing 40 to 45 hours to 60 hours/week. This is need of current and post COVID pandemic situation. Country needs to put extra efforts to increase productivity. There are few European and western countries, who are looking to reduce working hours from 5 days to 4 days or even 3 days. However, it won’t be appropriate to compare those developed nations, which are already developed and their need for extraordinary productivity is low. However, Fiji can not afford that kind of life style, unless we develop a culture of strong work ethics, productivity, quality standards, marketing and sales skills, international standards of accounting and finance. Today’s hard work by each and every person of the society is important to put extra hours to bring back the economy at base level. Fiji’s simple living cannot afford to have culture of slackness, easy going, “Din Maro“ culture. If we have to make country stronger and economically stronger than neighbouring countries, it is important to put extra efforts and work hard and be strong to make future sustainable. Then Fiji can enjoy the success of hard work by each and every community of Fiji and deliver better to next generations.

7. Export Oriented strategy

Increasing Exports. Today imports are more and export is constantly falling. Trade deficit is very high. This need to rectify by using various export strategies and boosting SMES and MSEs. This area is currently very weak and though efforts might have been put by various agencies and industries, but numbers not indicating any positive signs. Question is, what Fiji can offer to the world. Fiji does have some products and services which are doing well, like sugar, kava, agriculture products, fish etc. However, the generation of revenue from these products are not sufficient to adjust balance of trade between import and export. It is time to think and implement what other products can be produced in Fiji, which not only replace imports but also give opportunity to expand export horizon. Fiji is blessed with abundance land and certainly we can create more industry cluster some based on sectoral industry. This will help to make a new industry and cultivate a culture of export-oriented economy.

8. Migration

Fiji population is either stagnant or grow marginally every year. However, it is more inclined towards “Brain drain”, where large aspiring population tend to migrate overseas for so called better life. However, Fiji is not filling that gap of migration by getting new people in the country. Fiji need a drive to get more immigrants people; where they can contribute to economy with their skill, knowledge and expertise and also helps to increase consumption. Economy growth will have consumption as major contributor to GDP. Birth rate in Fiji is not bad, compared to many developed nations. That means, Fijians are very active and healthy to give birth. However, the figure is not crossing even 1.0 Million. We can adopt the strategy of New Zealand, where 10 years back they were around 4 Million Population. In current time, they are close to 7 million population. They allowed huge migration drive and today economy especially in housing, groceries, productivity, exports and education are growing rapidly. Fiji need to open for immigration with skilled and productive people where they generate value to the country. The simple logic is, more population means, more consumption, which eventually helps to improve the economy. Once India’s over population was considered as burden. The commonly used frame in India few years back in Hindi was “Dharti Ka Boz”. That means, those who are not productive or not doing anything, they are considered “unnecessary weight on earth”. The population which is of no use to society. However, when the economy opened in India, today, the same population become an asset from liability. MNC companies and world look at India as 1.4 Billion people means 1.4 billion opportunities to sell, consumer and drive economy.

Fiji definitely got resources, land, infrastructure to get skilled and entrepreneur business investor; who can be part and parcel of new Fijian economy. Increase population naturally equalise the ration of brand drain and increase over all consumption of food, groceries, medicines, leisure’s, travel, housing, medical, insurance and allied business sector in growth zone. If we see the neighbouring country like PNG; having 7 billion population, most of the MNCs like Total and Australian and New Zealand companies invested huge money in their economy.

9. Industry cluster Manufacturing zone

It is time for Fiji to create various industry clustered manufacturing zone, where low cost labour with high productivity and skilled staffing will be competitive advantage over pacific nation including Australia and New Zealand. Fiji can become manufacturing hub for pacific nations including neighbouring Australia and New Zealand. To make it more ambitious, products can boom in other world market to increase deeper penetration. Today, Fiji’s economy predominately based on tourism, trading and agriculture produce. This is natural curve of using the traditional mechanism of what works well. Again, there was no innovative or ambitious goals for local business people, where they thought to make manufacturing as alternative business expansion strategy. There are few manufacturers in Fiji and they are extremely successful. However, these numbers are just negligible. Culture of manufacturing is absolutely critical to create a manufacturing industry stronger for domestic consumption and export driven revenue.

10. Infrastructure

Fiji is much better in terms of basic infrastructure like Roads, Ports, Air and Sea logistics compared to many of our neighbouring countries. However, increasing geographical concentration in Suva and Nausori corridor; opportunity for Fiji to build additional infrastructure like highway, Paid Fast lane motorway, toll services, Railway line for passengers and commercial businesses to cover entire Vanualevu. This will speed up the movements, transportation and fast delivery of goods. Lots of FDIs will check for efficient infrastructure, before investing money in Fiji. The sea transportation has appropriately worked well with Sri Lanka organisation partnership with Aitkens. Today, Post Fiji is doing well with their professional services to shipping line, especially overseas. However, intercountry shipping links need substantial improvement and frequency. Rural and maritime villages are not connected well to urban cities of Fiji either through transportation, internet connectivity, communication etc. The connectivity of Rural to Urban cities of Fiji will open bigger market opportunities to rural community, where they can get better marketable value, price and profitability. That way, rural economy will get boost, rather than supporting them though subsidiaries, funding and free money.

Good highway, reducing crowded roads, establishing metro intercity rail, covering entire island through passenger and commercial rail line will improve the transport ease of movement and time saving and reducing carbon footing. 

11. Overall development of another sector

COVID-19 taught lesson to many industries and economy, not to put all eggs in one basket. It is natural for any country, where the fruits are coming, reinvestment is natural business decision. However, tourism sector of 35% of GDP seem to be very big contributor to Fiji economy. It is time to develop other sectors, where Fiji can get competitive advantage over other tourism. I am not too optimistic on Agriculture sector. I believe it helps to sustain economy with home grown products. However, Agriculture can be made commercial with clear strategical direction. Haphazard strategical goals will lead to only sustain day to day livelihood of Fiji citizen.

However, developing other sector of business, where Fiji can increase their revenue domestically as well as internationally will help to develop other sector of business and reduce reliance on traditional tourism sector is paramount at this stage.

12. Investment Strategy

Fiji need huge FDIs to grow the economy. Current FDI bill which is under discussion, before going in parliament need structural changes in the equity ratios. For example, in some of the sector investment, FDIs are allowed only to go 49%. However, when bigger investor wishes to come Fiji, local businesses don’t have appetite and capacity to fund large sum of amount. They either create a consortium or develop and 51% stakes and make a deal. Imagine, if someone want to invest $1.0 billion in any of the sector, the local investor or business people may find it difficult to raise capital of more than $500 million to establish joint venture. Hence, FDI bill need to re look and adjust the equity ratio in some sector. It is good to protect local businesses. However, some sector needs higher cash injection and hence, Fiji government should allow more FDIs to go up to 90% to even 100%. Let Fiji government get other benefits like employment, tax collection, export duty etc.

If we compare Fiji Vs Mauritius, having similarity of sugar-based economy. In early 1970s to 1980s Fiji had stronger economy. However, recently Mauritius officially became World Bank high income club member with per capita income more than double of Fiji. According to research of World Bank, Mauritius income per capita is USD $12,535, whereas Fiji income per capita is USD $5,800 (Professor Stephen Howes, ANU, 2021). According to research, both countries relied on tourism. However, Mauritius tourism is 39% of total exports, whereas Fiji Tourism is 54% to the total export. This equation is too large to put more than 50% of eggs in one basket.

Big investors, venture capitalist work on ease of operations, country creditability in overall governance, legislation, political stability, socio economic drivers, culture, productivity, enhancement of technology, infrastructure, ease of business, licensing and tax regulations. Good to accolade Government of Fiji, who recently passed investment bill and their consistent approach to bring bigger investment in Fiji. Recent Japanese firm investing close to $400 Million with EFL clearly indicate the confidence of overseas investment company on Fiji. However, this drive of investment in another sector is important. In addition, the big ticketed sector like technology, biotechnology, medical science, aeronautics, Artificial intelligence and cryptocurrency and machine learning technology drivers’ companies won’t be comfortable with local partners, because of not having co-related experience. Hence, these kinds of companies need bigger share of equity investment, where they should not be restricted with 49%; but allow them to increase up to 100% equity investment based on case to case and sectoral necessity.

13. Where is opportunity then for Fiji?

If we compare Fiji Vs Mauritius, Fijis Textiles and Business services is only 6% compare to Mauritius having 11%. This 6% contribute from Fiji water and fish industry. If Fiji wanted to improve in few areas, those will be infrastructure, regulatory quality, rule of law, government effectiveness, commercial aspects and approach of SOEs, Transparency and governance, sectoral portfolio matrix.

14. State Owned Enterprises Reforms

Apart from Private sector, Fiji government need strong support of State-Owned Enterprises (SOEs). There were lot of reforms and restructuring done with SOEs in Fiji. According to ADB report on SOEs performance, Fiji is not number 1 in terms of SOE performance. However, Fiji is on much higher standard than other pacific nations. One of the things close to my heart is SOEs performance and commercialisation. The SOEs are public organisation, where SOE bound to give good services to community, employment to community people and at the same time maintain their business in profitable venture. The traditional model of SOE used to be on Government grants. I am in opinion that, all SOEs should be commercial driven and profit oriented expect some of the essential services, where objective of SOE is to provide pure services in the welfare of society and not make profitable business.

Once the SOEs start becoming commercial and profitable driven, that will help them to deliver quality services to community, improve their standards, reforms and technological adaptation and eventually give dividend to Government who is treasurer of Public in general. 

15. Culture, Mind set and Attitude

Change in culture, mind-set, norms and values changes as generations move. The indigenous culture is slowly changing with global one talk culture. One of the biggest barricades sometimes happen from baby boomers and generation X, to the generation Y, which is current. The older generations evaluate the things based on their experience, norms, values and education they received. Today, generation Y is extremely smart and technology has given new engine for them to run as fast as they can. The things what one used to achieve in 10 years, now can be achieved in 2 years span. Things are drastically changing.

Young generation of “Y” need to create their stronger foundation and look for greater opportunity rather than having myopic views. In today’s world, opportunity are immense and there is no limit to reach wherever one want to climb. As per Newtons third law, Action and reaction are equal and opposite. That’s means, when one has strong attraction power to achieve something, the efforts also goes in that direction to achieve. Hence, generation Y should not waste their time on non-productive things and focus on making long term career in whatever passion and skill they have.

Attitude and mind set need reshaping with cognitive mind set approach. Many of the pacific people are generally satisfied with whatever they have. However, global world is changing and one can not live by separating themselves from global world. Our fundamentals of need also changed. Today, our services like internet, mobile, computer, transportation, smart TV, stylish clothing, concept of outside dinner and party becoming norm of todays generation Y. If the generation Y expect these things to pursue, time to change mind set, attitude to be more ambitious and dreamer. It says, that whatever one wants to achieve desperately; one automatically put efforts to achieve the same. If the generation Y take their career serious, they will improve their skill set, knowledge and create a stronger foundation which makes them marketable in their own country as well as overseas. This is global world. Migration, people moving from one place to another, brain drain, going to happen and will increase in coming years, as world become boundaryless. In longer goals, if we wish to have better life, better living standard and reduce poverty, economic growth plays crucial role.

16. Neighbour relationship.

It is undoubtedly gospel fact, Fiji is much stronger in terms of governance, policy, framework, regulations, controlling authority with stringent measures of system and policies. Over a period of time, Fiji government developed the various departmental infrastructure and network successfully with all functional network. This area of reform is lacking in other pacific nations.

It is important for Fiji to offer these kinds of expertise and specialities to neighbouring countries for them to grow. Having stronger and personalised relationship at private, individual and government level is absolutely necessary. Entire pacific should have stronger bond with each other and form a cluster. Fiji can build resilience economy by building bridges with neighbours and achieving their trust, integrity and honest friendship; where pacific nations can rely on Fiji on various reforms, supply and logistics, making Fiji as pacific hub for business activities. When two partners think of win-win goal; the results automatically become to close to heart and soul and that’s where Fiji can make “Economy of One Talk” with pacific nations.

17. Health care system

Fiji health care system need a stronger boost. COVID-19 taught us a lesson to reduce uncertainty, it is important to have specialised hospitals and Doctors; who can perform all medical services which any patient expects. Over a period of time, health care system in Fiji improved. However, the pace other infrastructure improved, health care lagged behind. Classic example of India, where the biggest issue during COVID-19 Pandemic is poor public sector hospitals and resources. Fiji need improved healthcare system, where residents feel safe and secure with the current health system, which includes hospitals, beds, Doctors, nurses, equipment’s, medical testing, innovation to deal with new diseases, in house surgeries and medical diagnosis. This will boost huge confidence of local as well as tourist confidence.

Summary

Fiji has gone long way from 20 years odd to today’s economy. COVID-19 not only created havoc in global world, but Fiji is also highly affected health wise and economically. It is time for each and every person from Fiji to put their contribution for nation building. When time is tough, no point in arguing, pointing fingers, giving excuses, gossiping. Time for every person to contribute, think new ideas and consider their survival is based on their success and sustainability of country. Let us focus on building new economic direction to Fiji and build great longevity scale Fijian economy. Just like Singapore, Abu Dhabi, USA created their economy despite having so many challenges.

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