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- Local Government
- Government Ministries & Departments
- Civil Service Reforms
- Foreign Policy
- More ...
The country has a local government system. City and town councils fall under the general supervision of the Ministry of Local Government and Urban Development. Suva / Lautoka have city councils while Nadi, Ba, Tavua, Sigatoka, Rakiraki, Labasa, Nausori, Levuka, Savusavu and Lami have town councils. Municipal councils have the power to levy rates in order to fund operating and capital developments. Government helps local bodies with technical services, town planning, grants and loans. Each municipal council is headed by a Mayor and elected councilors.top of the page
Government Ministries & Departments
About 22 ministries conduct the affairs of the government, and the Minister who heads a department is responsible to Parliament for its activities. These ministries are staffed by a career public service, whose members do not relinquish their jobs on a change of government.
PSC is responsible to the Government for the efficient and effective management of the Public Service. It is also responsible for the human resource management and development for the Public service and facilitates these through the formulation of policies and practices. The promotion and upholding of the Public Service Values and compliance with the Public Service Code of Conduct are pivotal to the efforts by the PSC in ensuring that the highest ethical standards are maintained throughout the Public Service.
The Public Service is independent of the political government and its functions and roles are established by the Public Service Commission. The Public Service Commission (PSC) is implementing a number of significant measures aimed at reforming the service. The reforms taking place are already making a great difference in the services provided by various Ministry/Departments. This has brought great deal of dramatic changes in the way civil service is operating and it has certainly improved in the delivery and quality of public service and public goods.
In May, 2003 it approved a new theme for the Civil Service Reform Programme called Service Excellence. The five key objectives of the programme are to provide strong leadership, a productive and professional workforce, accountable and efficient organizations, quality customer services and an integrated approach to service delivery. The launching of the Service Excellence Awards logo and the theme in July marked a beginning of a journey in the civil service.
One Government – 46 Agencies, the theme of the Service Excellence Awards signifies that service excellence is a shared and collective responsibility of the 46 agencies. The Service Excellence Awards comprise of two levels: Organizational level and the Exemplary Awards to officers within government agencies who demonstrably perform according to the given criteria.
Civil Service Reforms
The Civil Service Reform includes:
• The formulation of A Senior Executive Service Policy Framework.
• Permanent Secretaries on employment contracts from January 1, 2004;
• The delegation of powers of appointment and promotion over remaining occupational groups; and Skills upgrading for executive management.
Government has begun the implementation of the Financial Management Reform (FMR) programme. Under the Financial Management Act 2004 Chief Executive Officers are given more financial authority over their budgets. The objective of the new Act is to adopt a performance focus and strengthen accountability by progressively improving the existing financial management framework.
A major component of FMR is the introduction of a new Information system that will improve the collection of relevant and timely data on financial transactions by ministries and departments. The new FMIS is expected to:
• automate most current manual business/accounting processes,
• improve financial reporting,
• strengthen the monitoring of budgets,
• strengthen control over spending,
• support the move from cash accounting to accrual accounting and the accompanying asset management; and
• support the adoption in of performance budgeting.
On a broader financial management reform program, progress is being made with the revamping of the corporate planning process. The Annual Corporate Plan process provides a crucial link between the Strategic Development Plan and the Budget.
Fiji's international relations policy recognizes the important role small developing island states like Fiji plays in the international political/economic arena and seeks to build upon the positive relationships which Fiji enjoys with a wide range of nations in the world. It also testifies to the political, cultural and economic values Fiji attaches to the political, relations it is now forging with Asia in its "Look North" policy and the traditional relationship it has enjoyed with the Pacific Forum States, North America, ACP/European Union and the Commonwealth.
Fiji's foreign policy is also based on political values, which Fijians have long been proud to be associated with, namely the respect for fairness and justice in the conduct of trade and political affairs, sustainable development programmes that promotes environment protection and the desire to live in a world without the threat and/or fear of war, hunger and environmental degradation.
The residence of the Cold War rivalry, which dominated and characterized in the most part, the conduct of political relations in the twentieth century has increased the awareness of a myriad of other economic, environmental, human rights, religious and ethnic issues, that now forms the core challenges facing the international community to which Fiji is an active part. In short, the political objective is to achieve excellence in the development and expression of Fiji's foreign policy through proactive participation in the international flora, respecting the provisions of international treaties to which it is party and fostering fruitful bilateral and multilateral diplomatic relations with friendly nations and international organizations.
Political objectives in foreign policy are:
• To maintain and where possible, strengthen, bilateral relations with friendly countries, with increasing focus on new friends within the wider Pacific Rim, particularly in South East Asia.
• To project a favorable image of Fiji overseas through various means, including personal contact and initiatives, and a range of media activities.
• To assist in contributing to international peace and security, in particular through the United Nations;
• And to seek resolution of regional conflicts born out of ideology differences, economic rivalry and/ or cultural antagonism through diplomatic representations,
The objectives pursued through diplomatic activities are:
• To attract foreign investment particularly for joint ventures;
• To promote Fiji's tourism sector, to identify new markets for Fiji's products and expand existing markets;
• To facilitate and expand overseas development assistance to Fiji;
• To assist in attracting skilled personnel to Fiji in key areas, to provide where possible, assistance to less developed member countries of the South Pacific Forum; to draw international attention to environment abuse of the Pacific region and promote measures of environmental protection;
• To monitor and report on relevant technology;
• To represent Fiji's special circumstances in respect of indigenous and human rights matters
Fiji's major trading parties are Australia, New Zealand and the US with Pacific Island neighbours Papua New Guinea, Samoa and Vanuatu also having important trading links. Exports are forecast to increase by a marginal 0.4 percent this year.
The upbeat performance from garment, gold and mineral water are expected to be offset partially by the faltering contributions from sugar and fish. In 2006 exports will be driven by gold, timber, fruits and vegetables, coconut oil, mineral water and fish.
Other significant contributors in 2006 include re-export of petroleum products and other domestic exports such as biscuits and paper products. In contrast, molasses, footwear, textiles and garments are expected to contribute negatively. Growth in mineral water exports is expected to contribute significantly over the medium term. In 2004, exports of mineral water totaled $52.3 million, a significant increase from $1.1 million in 1997 when it was first exported. Over the last five years imports have increased at a steady pace.
Import levels in 2004 show an increase of 9.5 per cent over 2003, reflecting growth in consumption items such as food, beverages and tobacco and investment items, in particular general industrial and electricity machinery, and telecommunications equipment.
Fiji’s trade regime has three components: bilateral trade agreements (BTAs) with our closest neighbours and main trading partners, Australia, New Zealand and Pacific island countries such as Tonga, Papua New Guinea and Samoa.
The second component is the Melanesian Spearhead Group Trade Agreement (MSGTA), the Pacific Islands Countries Trade Agreement (PICTA), and the Pacific Agreement on Closer Economic Relations (PACER).
The third component of Fiji’s trade regime is, of course, in the multilateral trading system itself. MSGTA: Melanesian Spearhead Group Trade Agreement was conceived in 1986 between PNG, Vanuatu and Solomon Islands.
Fiji formalized its membership in 1998 through the MSGTA, followed by the FLNKS of New Caledonia as a member on observer status. The objective of the MSGT are to promote and facilitate the free flow of goods and services by means of gradual and progressive removal of tariff and non- tariff barriers to trade between parties; to ensure that trade between the parties takes place under conditions of fair competition; to take appropriate measures to facilitate, strengthen, consolidate and diversify the trade between parties on a long- term and stable basis; and to contribute to the harmonious development and expansion of world trade. Any item can be imported without tariff from PNG, Solomon’s and Vanuatu.
PNG has 50 items; Solomon’s has 71 and Vanuatu 63 on a negative list. A MSG meeting in Suva in July 2004, endorsed an amended Legal Text of the MSGTA, which seeks to include, amongst other things, trade in services and membership to non-MSG countries.
PICTA was entered into force in April 2003. Since then the following Forum Island Countries (FICs) have ratified; Cook Islands, Fiji, Kiribati, Nauru, Niue, PNG, Samoa, Solomon Islands, Tonga, Tuvalu and Vanuatu. PACER is a framework agreement amongst the Forum member countries, differing from PICTA in that it includes the two developed partners; Australia and New Zealand. PACER provided under a Regional Trade Facilitation Programme (RTFP) for technical assistance and trade capacity building, financing and technical assistance from Australia and New Zealand to the non -developed parties.
PACER entered into force in October 2002, and currently has ten parties; Australia, Cook Islands, Fiji, Kiribati, Nauru, New Zealand, Niue, Samoa, Solomon Islands and Tonga. Economic Partnership Agreement (EPA) with the European Union EP/EU. The EPA is the result of the African, Caribbean and Pacific EU Partnership Agreement signed in Cotonou on June 23, 2000.
International Trade has increasingly become an underpinning determinant of economic prosperity in most countries of the world, and Fiji is no exception. External trading relations increasingly determine the growth and development of the country, and these influence only increases with worldwide moves to free trade and globalization. In line with most developing countries, the last decade has seen Fiji adopt an export orientated, outward looking approach to trade relations.
Import restrictions have been largely lifted in favor of export promotion, and as such Fiji now has a more open economy with increased volumes of both exports and imports. Fiji is a signatory to a number of bilateral, regional and multilateral trading agreements. The most significant is membership of the World Trade Organization (WTO), which holds Fiji to certain obligations regarding trade policy, but offers huge opportunities to benefit from increased access to foreign markets. On a regional level, SPARTECA offers duty free access to the products of Forum Island Countries (FICs) to the markets of Australia and New Zealand, subject to "Rules of Origin" regulations.
The ACP -EU Cotonou Convention (previously known as Lome Convention) offers a number of benefits to the Fiji economy, predominantly through the Sugar Protocol that guarantees preferential access for a set quota of sugar at prices substantially above the world market price. Cabinet has approved changes to the Melanesian Spearhead Group Trade Agreement (MSGTA) with the inclusion of the finalization of a “negative list”. Negative listing under the trade agreement works on the basis that all goods will eventually be traded duty free under the agreement, except for those listed as exempted products from the agreement on the ‘negative list’ of each country. Globalization and freer trade, offer opportunities and dangers to a small country such as Fiji.
The WTO, and the non-discriminatory "Most Favored Nation" principle it enshrines offers equal rights to market access concessions made to larger countries that Fiji was not able to negotiate on its own. This increased and secure market access allows exporters to boost production and likewise revenue and employment. The Fiji - Australia Trade & Economic Cooperation Agreement (FATERA) was signed in 1999 in Canberra, Australia, setting the framework for better bilateral trade between the two countries in the long term. Australia is Fiji's biggest trading partner (about 60% of Fiji's total trade is with Australia.) The USA is a major market for Fiji's export of garments under a quota system as per the Bilateral Textile Agreement signed in 1995 between the two countries which expired at the end of 2004. Bilateral relations with Japan, South Korea and China have always been cordial.
The newly promoted "Look North Policy" will further strengthen the relationship. Fiji has in existence a Bilateral Trade Agreement with China, in 1997, under which China offers Fiji's exports MFN treatment. The recognition of need to engage a major emerging world power saw the opening of the Fiji Embassy in Beijing in July, 2001. A bilateral agreement on agriculture was signed in August between China and Fiji and relevant ministries of both countries are also working on a bilateral agreement on quarantine issues.
The government is taking full advantage of bilateral relations in attracting investment that brings in new technology to Fiji, especially to the export sector, to boost our policy on export orientation. This is being done with the help of the diplomatic presence, for instance, in China, India and Malaysia. It will explore possible trade, investment and development assistance from other Asian countries e.g. Thailand that will become the 13th Post Forum Dialogue partner here in the Pacific Islands Forum. Fiji supported Thailand in its application to be a PFD partner.
Natural Resource Sector
A significant proportion of Fiji’s population continues to be involved in the Natural Resources Sector. This sector is expected to drive growth in 2006 contributing 0.5 per cent to the overall growth. It is expected to remain a significant driver of growth in 2007 and 2008. Improvements in the sugar industry through the restructure, improvement in production of other crops and livestock and commercial harvesting of pine and mahogany are expected to contribute positively.
The sugar industry, which has been the principal export of Fiji since 100 years ago, continues to occupy a dominant position in the economy. It has contributed significantly to the development of the economy and continues to provide jobs and incomes for many thousands of people. Around 200,000 people are dependent on the industry. A growth of 4.3 per cent is anticipated in 2006 compared to the subdued performance this year. Positive growth of 3.9 and 3.8 per cent is expected in 2007 and 2008.
Government had approved a commercially based restructure of the industry, to improve efficiency through upgraded machinery, equipment and infrastructure and to resolve the expiring land lease issue. Government acknowledges that the industry is facing severe problems and anticipates that these challenges will be met through reforms underpinned by rigorous research, and decisive actions.
In April 2004, Cabinet approved in principle to adopt the recommendations of an Indian Government sponsored technical mission on the commercial structure of Fiji's sugar industry. Government has welcomed the approach recommended by the Technical Mission in that it looked at the reform in the sugar industry as a whole, covering milling, cane production, the transport system and the up-skilling of workers. The restructure proper is set to begin in the New Year with the upgrade and installation of new plant and machinery expected to be complete in time for the 2006 crushing season.
The Government has signed a deal authorizing four of Fiji’s sugar mills to be managed by the Indian technical Mission. The four mills will be managed for three years. The Fiji Sugar Corporation signed an agreement to take the loan of $86 million from India’s Export-Import (Exim) Bank. The loan which will be utilized entirely in the sugar reform will be a long –term loan with 10 –12 years time to pay off. The medium-term outlook for the industry is that sugar production will improve this year as a result of the positive impacts of Government's efforts on transportation and milling infrastructure in the industry.
The Fiji Sugar Corporation (FSC) Act has been repealed to facilitate the restructure of the Sugar Industry. This will allow the company to operate fully under the Companies Act, instead of a ‘stand alone’ legislation. With the repeal of the FSC ACT, the Company returns to its former status as a public company governed under the Companies Act and not be governed under an Act of Parliament. The repeal of the FSC Act is part of the way ahead for the reform of the sugar industry as recommended by the Sugar Technical Mission (STM) of India.
The potential for the expansion of the mineral sector in Fiji is considerable given its geological formation and location in the Pacific. Most reconstruction of the past sees that Fiji not so long ago was an integral part of the Pacific "Rim of Fire", a complex plate boundary. This boundary is well-recognized as the focus of several major world-class porphyry copper-gold and epithermal gold systems. Besides precious and base metal prospects there are also industrial minerals (stone, marble and aggregates amongst others) that can be developed in the short to medium term.
The Mining and Quarrying sector is also expected to grow by 14 percent in 2006 compared to an estimated decline of 23 per cent in 2005. Whilst this sector is dominated by the mining activities at Emperor Gold Mines (EGM) in Vatukoula, operations such as dredging, gravel extraction and quarries do exist elsewhere in Fiji. Mining prospects for this year are favorable, in line with EGM's planned expansion of the mines. Cabinet in March 2004 approved a 21-year extension to the mining leases and rights of EGM, which also produces silver as a by-product. Production to date in the mine, which commenced in the early 1930's is well over 1.7million ounces of gold or 120,000 ounces annually. This equals around $70- million per annum.
The Manufacturing sector plays a strong role in the economic fundamentals of the country. The country's strong economic growth since 2000 has been attributed to production growth registered in this sector, much attributed to the tax-free factories. The Manufacturing Sector contributes 12-15 per cent of GDP with garments being the second-highest foreign exchange earner to Tourism. It is estimated to have grown by 3.6 per cent in 2004, which is a slight improvement from the 3.2 percent growth estimated in 2003. A few large companies performed exceptionally well, boosting output in this sector.
Furthermore, some of the producers also succeeded in securing orders from those garment factories that ceased operations, thus offsetting production losses. In the medium term, Government will focus on diversification of the manufacturing base, expansion of competitive niche industries with high-value added components. It will increase its efforts in facilitating the linkage between other crops (primary production) and manufacturing through increased promotional activities and awareness programs on manufacturing.
Transport, Storage and Communication
The Transport, Storage and Communication sector has experienced robust growth over the past few years. The sector is riding on the wave of the tourism industry which has led to the increase in airline and shipping services. This sector is estimated to have grown by 5.5 per cent in 2004, compared to expected growth of 2.7 per cent in 2003. Air Transport and Services Allied to Transport sub – sectors are expected to be the major contributors to this growth as a result of expected growth in the tourism industry.
Tourism is considered Fiji's star performer after its performance and quick recovery after the 2000 political and economic crisis. The tourism industry is currently the country’s largest source of investment and foreign exchange earner. Despite the decline in 2000, the industry has recovered well. The prospect of reaching the industry’s target of becoming a billion dollar industry is in sight with earnings estimated to reach $917 million in 2007.
Investment levels have been relatively low over the past decade, averaging at 12 per cent of GDP. However, this trend has significantly improved to 13.7 per cent in 2001 and is now estimated to be around 17.0 per cent of GDP, driven largely by the private sector. This improvement is testament to rising investor confidence in the economy. Investment is required to sustain higher growth in the medium term. In this regard, Government has amended the Foreign Investment Act, streamlined the investment approval process, embarked on public enterprises reform programmes and through its Public Sector Investment Programme has provided for more and better infrastructure facilities.
The labour market is an area where reforms are to be implemented. The reform effort aims to link wages to productivity and skills. The major reform effort in 2003 was the finalization of the Industrial Relations Bill a comprehensive legislation which addresses the conditions of employment, trade union recognition minimum wages and introduces a labour court to settle industrial disputes.
The May 2000 political and economic crisis had caused redundancies and reduced incomes through shorter working hours. The worst affected sectors were tourism, garments, retail and construction. A high level of outflows of skilled citizens through migration has been of great concern. In the medium term, skill shortages will be addressed through more and better training programs. Employment situation in other industries basically improved.
The Integrated Human Resource Development Programme for Employment Promotion (HDPEP) has been extended to complete piloting of the initiatives. Its replication throughout the 14 provinces will facilitate the promotion of sustainable formal and informal jobs in the rural as well as urban areas. On the wages front, concerns are of the rise in wages that is not performance or productivity based. Government will continue to address labour market constraints of wage setting and Industrial Relations; low productivity, skill shortages and inadequate functioning of the labour market.
Fiji and the South Pacific
Regional interests focus on membership of the South Pacific Forum and other regional agencies, and bilateral relations with countries in the region. Fiji plays a very important role in the South Pacific Forum. Being a founding and leading member of the Forum, it is committed to assisting its neighboring island countries in their development. Fiji will continue to support regional cooperation in the Pacific Islands region, acting in concert with its neighboring countrie
Prior to that Fiji had enjoyed de-facto status since independence. Fiji also has long standing historic cities with Australia and New Zealand, including strong trade relations originating from the previous South Pacific Regional Trade and Economic Cooperation Agreement (SPARTECA). The agreement has been historically important in the development of manufacturing in Fiji particular in textile, clothing and footwear (TCF) which has become a major export industry following its establishment in 1988. The TCF industry has faced significant difficulties due to uncertainty over the extension of the new SPARTECA arrangement - the SPART-ECATCF Scheme.
The Australian Government had agreed in March 2001 to a replacement preferential access scheme for TCF thus the SPARTECATCF Scheme. Defense cooperation with both countries, Australia and New Zealand has resumed after it was interrupted by the events of 1987 and 2000. Fiji has strongly opposed the conduct of nuclear tests in the Pacific region, the dumping of toxic waste and the use of drift nets for fishing. It has strongly supported efforts to promote sustainable development in the particular conditions of small island states. It has drawn attention to the special environment threats relating to the small islands of the Pacific.
Through its membership of the Forum, Fiji is involved in the Pacific Island Countries Trade Agreement (PICTA) and the Pacific Agreement on Closer Economic Relations (PACER). Negotiations on these two landmark agreements were concluded in June 2002 and provides for the future trade and economic cooperation of the forum region as a whole by proving for the establishment of a Free Trade Area among the 14 FICS.
Fiji and the World
Regional interests focus on membership of the South Pacific Forum and other regional agencies, and bilateral Fiji and the World. In order to be effective in our business abroad, the specific roles of the nine missions abroad will be reviewed, with the firm objective of reinforcing their performance. A major initiative will be focusing on aligning their roles more toward trade promotions and securing market access for our export products. It is anticipated that in the course of their duties, closer consultations with our promotional agencies such as the Fiji Islands Trade and Investment Board (FTIB) and Fiji Visitors Bureau (FVB) will be maintained and strengthened so that the country can maximize effective use of resources and information flow.
The Foreign Affairs Ministry will closely monitor the developments arising from the trade and economic agreements with Australia and New Zealand to further enhance and facilitate trading relations, to safe guard our market access with the two neighbours, consequently providing a viable alternative to SPARTECA. The Ministry has therefore re-opened the Sydney Consulate General Office to cater for such an important area. Government will continue to strengthen the Embassies in Asia to get optimum benefit from them, particularly in enhancing trade and economic relations. It will also establish new embassies with the objective of tapping into potential markets. In Asia and particularly China with a population of around 1.2 billion people, there is an immense opportunity to tap new opportunities. India has been identified as another market which can offer potential access for products.
The new Fiji High Commission in India opened in 2004. In 2002, as part of India’s “Look East” policy and further to India’s dialogue partnership of the ASEAN, India successfully applied to become a dialogue partner of the Pacific Islands Forum (PIF), with the support of the Fiji Government. The dialogue partnership of PIF provides India and the Pacific Region a structured mechanism of interaction on issues of mutual importance. With Prime Minister’s recent visit to India it has strengthened the bilateral ties by the signing of four agreements of cooperation in the areas of health and medicine, information technology and tourism and trade. The Indo-Fijian bilateral trade stood at $28.5 million during 2004 – 2005.
Fiji will also continue to strengthen its bilateral relations and regional and international participations because these are the essential building block for our regional and multilateral relations. To date, Fiji has formal diplomatic relations with 70 nations. Fiji has ten overseas missions. The diplomatic missions are located in Beijing, Brussels, Canberra, Kuala Lumpur, London, New York, Port Moresby, Tokyo, Washington, Wellington and New Delhi. Most of the Heads of Mission are also cross accredited to a number of other countries. There are, in addition, 11 honorary consuls to represent Fiji's interests in Brisbane, Melbourne, Perth in Australia, Ottawa in Canada, Hong Kong, Tel Aviv, Seoul, Singapore and Los Angeles, Portland-Oregon, San Fransisco in the United States of America. The promotion and establishment of external trade and economic relations through negotiation is also an important function of the ministry and the diplomatic overseas missions assist with the responsibility for trade policy implementation and coordination of trade promotion activities.
The missions also identify and encourage potential foreign investors. In addition, the Ministry also liaises with the private sector, the Fiji Visitors Bureau and the Fiji Islands Trade and Investment Board in promoting and expanding Fiji's trade and economic relations. Currently Fiji has three Trade Offices in Sydney, Los Angeles and Taipei respectively. The two embassies that are maintained in the United States are in Washington and New York, with the latter being representative to the United Nations. The embassy in Brussels represents Fiji to the European Union. A new embassy in Beijing and mission in India have been opened.
The change to export oriented economy policy strengthens the requirement for economic diplomacy in overseas missions. Overseas missions will in future, play a much stronger role in promoting Fiji products, tourism and investment. Greater support for the Fiji Visitors Bureau will also be provided through the overseas missions. Lately the government organized the Head of Missions from all 12 countries abroad for a consultations conference. The meeting provided a valuable forum for evaluating our foreign policies and international relationships, and ensuring they are fully aligned with the Government’s programme of social and economic development.
The Heads of Missions were briefed on details of individual policies as contained in the Strategic Development Plan and its implementation. Each of the diplomatic offices had a crucial role in assisting Fiji to achieve the Plan’s goals especially in attracting and mobilizing investment, boosting trade and facilitating aid.
Fiji is in its fourth year of strong and continuous economic growth. This is quite unprecedented, clearly indicating that the measures taken to rescue Fiji's economy after 2000 have borne fruit. The three-year Strategic Development Plan (SDP) of Government began implementation in 2003. Government's theme of the 2006 Budget is “Building a Stronger Economic Platform” It will pursue growth but at the same time build a stronger foundation that will deliver growth prospects.
Tourism continues to be the main earner of foreign exchange followed by garments, sugar, fish, gold and mineral water. If the present positive situation continues, tourism will be on target to achieve its goal of annual earnings of $1billion by 2007. The Film Industry is also gaining significant ground in Fiji with a Film Tax Rebate Legislation. Mahogany and the Information Technology (IT) industries are two areas that are potentially lucrative. Fiji is no longer an agriculture-based economy. The distribution of economic power in the country comparing the size of the major sectors shows that the primary resource based sector-which encompasses agriculture, forestry, fishing and mining has declined in its share of GDP since 1986 from 25 to 18 per cent. It has been surpassed by the wholesale & retail trade, restaurants & hotels sector which now accounts for 19 per cent of GDP and is growing. This retail sector incorporates the flow on effects of tourism.