The Reserve Bank of Fiji (RBF) has reaffirmed that the domestic economy is set to achieve growth for the fourth straight year by 2025. Despite some challenges faced by various sectors, key industries continue to show generally positive trends.
The October 2025 Economic Review reported a slight increase in visitor arrivals, which grew by 0.3 percent to reach 735,154 in the year ending September. This upsurge was primarily driven by significant growth from the United States (11.3%), the United Kingdom (10.6%), and other Pacific Island nations (5.0%). However, arrivals from traditional markets such as Australia (down 0.6%), New Zealand (down 2.8%), and Asian countries (down 9.7%) saw declines.
The RBF highlighted tourism as a critical component of economic growth, emphasizing the recovery observed in emerging markets like the US and the UK. The timber sector has also demonstrated strong performance; woodchip production rose by 4.5 percent, sawn timber increased by 1.4 percent, and mahogany production surged by an impressive 90.3 percent. Furthermore, electricity generation saw a modest rise of 0.3 percent, signaling higher demand from both domestic and industrial consumers.
Nevertheless, the sugar and cane production industries are facing difficulties, with outputs declining by 5.1 and 18 percent, respectively, due to operational challenges and subpar cane quality. Additionally, the RBF noted a decrease in mineral water and gold production, with Vatukoula Gold Mines Limited reducing ore output by 25.8 percent, which overshadowed the gains made by Tuvatu Mine.
On a more positive note, consumption activity remains robust in Fiji, buoyed by rising incomes, strong inflows of remittances, and increased government expenditures. The October 2025 Economic Review indicated notable increases in consumption-related loans (31.5 percent), net VAT collections (1.3 percent), and vehicle registrations (23.9 percent) for both new and used cars as of September. Additionally, electricity consumption increased by 1.7 percent, reflecting elevated demand from households and businesses alike.
The RBF stated that the optimistic momentum in consumer spending aligns with positive retail sentiments, as evidenced by reported higher turnover in sectors such as motor vehicle sales, fuel, hardware materials, and food and pharmaceuticals. The Wholesale, Retail, and Trade (WRT) Survey revealed a 4.4 percent increase in total sales and service income for the first half of the year, amounting to $3.4 billion.
Looking ahead, retail sales are projected to continue strengthening into late 2025 and 2026, supported by lower VAT rates and increasing disposable incomes. The RBF noted, “Overall, consumption activity is expected to remain strong, sustaining steady domestic growth momentum.”
The outlook for Fiji’s economy remains hopeful, as sustained consumption trends, coupled with ongoing recovery in tourism and sectoral production, pave the way for further growth. The RBF’s assessments indicate a resilient economic environment as Fiji navigates through challenges, presenting opportunities for a brighter future.
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