Title: Macro-financial risk in the South Pacific: analysing balance sheet effects for Fiji economy

Authors: Devendra Kumar Jain; Rup Singh; Hamid Waqas

Addresses: Flame School of Business, Flame University, Pune, India ' Department of Economics, The University of the South Pacific, Suva, Fiji ' Finance and Accounting Department, Westminster International University, Tashkent, 100047, Uzbekistan

Abstract: The general failure of highly sophisticated models of financial risk management (based on flow variables) prompted international financial institutions, researchers, and academics to look for options beyond the traditional macroeconomic indicators. This paper contributes to the gap in the literature related to the qualitative analysis of macro-financial risks of small island developing economies. The qualitative analysis based on the aggregate balance sheet of the Fiji economy is aimed at identifying sector-specific weaknesses and their developmental paths (sources of weaknesses). It analyses various financial risks across key economic sectors (government sector, central bank, other depository corporations (ODC), other financial corporations (OFC), other non-financial corporations (NFC), other resident and non-resident) and their linkages and spill-over effects from one sector to another sector within the aggregate economy. The findings are indicative and exploratory of sector-specific weaknesses and invite further research interest in applying the framework to other similar economies in the region.

Keywords: macro-financial risk analysis; South Pacific; Fiji; balance effects; financial crisis; small island developing states; stock of data analysis; systemic risk; balance sheet approach; seven-sector approach.

DOI: 10.1504/IJTGM.2022.128112

International Journal of Trade and Global Markets, 2022 Vol.16 No.1/2/3, pp.11 - 29

Received: 16 Mar 2020
Accepted: 07 Apr 2020
Published online: 06 Jan 2023 *

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