The Asian Development Bank’s warning that Fiji’s economy will slow markedly over the next two years has injected fresh urgency into pre‑budget discussions about how to shore up the country’s tourism-dependent recovery. In a new forecast cited by industry representatives this week, the ADB projects growth will ease to 2.9 percent in 2026 and 2.7 percent in 2027, citing softer tourism demand, pre‑election uncertainty and weakening external conditions. Those revisions make the government’s 5 percent annual growth target increasingly unlikely for a third — and possibly a fourth — consecutive year.
The caution comes even as tourism remains a critical engine of jobs and supply‑chain activity. Fiji Bureau of Statistics figures referenced by sector groups show paid employment rose to 121,971 in 2022, up 7.1 percent from 2021, with accommodation and food services adding 3,453 jobs — a near 49 percent jump. Arts, entertainment and other service activities also recorded strong gains, reflecting demand for local suppliers and activities tied to visitor spending. But industry leaders warn that the sector’s current strength can reverse quickly when external demand softens.
With the national budget now the focus of consultations, tourism stakeholders are pressing for practical, measurable changes rather than broad promises. The most repeated demand is for real improvement in the ease of doing business — not deregulation, they say, but smarter, better‑coordinated regulation. The sector points to persistent duplication and fragmentation across government agencies, approvals that proceed in sequence rather than in coordinated parallel, unclear timeframes, and the risk that digitising an inefficient process simply moves the delay online without solving it.
Industry recommendations being put to the finance ministry and other agencies include setting clear service standards, cutting processing times, and creating mechanisms for inter‑agency coordination so that businesses can obtain a single compliance outcome without navigating multiple disconnected systems. Stakeholders argue that lost time in approvals translates directly into delayed projects, higher development costs and ultimately higher prices for consumers — outcomes that undermine tourism competitiveness at a time when timing is crucial.
A second, urgent technical issue is the government’s planned introduction of a VAT Monitoring System. While businesses broadly accept the goals of greater compliance and transparency, hoteliers and operators say the proposed system as currently conceived fails to account for the complexity of hotel operations. A hotel’s revenue flows run through multiple, integrated systems — reservations platforms, property management systems, food and beverage interfaces, activity bookings and finance ledgers — not a single point‑of‑sale terminal. Industry bodies insist the VAT monitoring rollout must include phased integration, comprehensive testing, staff training, and clear support for the ongoing maintenance costs that such integration entails.
Budget constraints strengthen the case for reforms that improve the business environment rather than rely solely on more spending. Finance Minister Biman Prasad has stressed the need to generate income to service debt in his pre‑budget messaging, and the ministry’s recent fiscal updates project national debt rising toward $12 billion by 2027. Tourism stakeholders say well‑targeted, low‑cost policy fixes — clearer regulatory timeframes, coordinated approvals, and a practical approach to VAT monitoring — could preserve investment momentum without large new outlays.
As the national budget is shaped, the industry’s message is pragmatic: preserve tourism’s gains by removing operational frictions and ensuring compliance reforms are workable for complex businesses. Failure to deliver measurable improvements, the sector warns, risks stalled developments, rising costs and a diminished ability to capture the economic benefits tourism has delivered to communities across Fiji.
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