The Magical Disappearing Debt Trick: Biman Prasad’s Economic Illusion

Ladies and gentlemen, gather around! Witness the grandest economic magic trick of our time—the miraculous vanishing of national debt, as performed by none other than Biman Prasad. With a swift wave of his statistical wand, the good professor-turned-politician has convinced an entire nation that even though the debt is rising, it is actually... falling. How, you ask? Simple. He has mastered the ancient art of manipulating ratios!

Let’s break it down. Fiji’s national debt is increasing—yes, that’s right, increasing. But fear not! Instead of addressing that unpleasant fact, Prasad simply shifts focus to the Debt-to-GDP ratio. “Look!” he exclaims, “The ratio is going down! Everything is fine!” But before we break out the celebratory grog, let’s ask ourselves: how is this possible?

The answer, dear readers, lies in the composition of GDP. For those not fluent in economic double-speak, GDP is the total value of all goods and services produced within the country. Now, here’s the kicker: one of the biggest contributors to GDP is government spending, and guess what fuels that spending? That’s right—debt!

It’s the perfect economic ouroboros, the snake eating its own tail. The government borrows money, spends it on infrastructure, stimulus packages, or grand recovery programs, which then boost GDP, which in turn lowers the Debt-to-GDP ratio. But wait—has the debt actually gone down? Nope! It has climbed higher than a drunken tourist attempting to conquer the Sigatoka sand dunes. Yet, because GDP is also inflated by the very debt used to prop it up, the ratio appears more favorable. It’s financial wizardry at its finest.

Now, let’s not forget the elephant—or rather, the virus—in the room: COVID-19. The pandemic threw Fiji’s economy into a nosedive. Borders were shut, tourism (our economic lifeblood) dried up, businesses collapsed, and government borrowing soared to keep the country afloat. Rightly so—desperate times called for desperate measures. But now, as the economy is rebounding, thanks to reopened borders and a surge in tourism, GDP is naturally growing again. And guess what? That means the Debt-to-GDP ratio was always going to decrease as part of the recovery process.

So, what has Prasad really achieved here? Nothing, except for trying to convince the public that a natural post-COVID recovery is some kind of fiscal masterstroke. He takes credit for what was an inevitable statistical adjustment. Meanwhile, the actual amount of debt still looms large, much like an uninvited relative at a family function—ignored, but impossible to get rid of.

At the end of the day, using the Debt-to-GDP ratio as a measure of success is like saying you’re getting healthier because your weight has remained stable—even though you’re just standing on a taller scale. The truth remains: debt is debt, and someone will eventually have to pay the bill.

So, next time you hear a politician like Biman Prasad boast about a falling Debt-to-GDP ratio while debt itself continues to mount, remember—you’re not watching real economic reform. You’re simply watching a very well-rehearsed magic show.