Fiji’s foreign reserves were notably recorded at approximately $3.7 billion as of December 31, 2025, providing a strong financial cushion for the nation. The Reserve Bank of Fiji (RBF) confirmed that these reserves are adequate and capable of covering 5.6 months of retained imports, projecting their sufficiency over the medium term.
In its December economic review, the RBF highlighted a widening merchandise trade deficit, which increased by 10.1 percent in the year leading up to October. This marks a significant shift from a 4.0 percent narrowing in the same period the previous year. The annual outturn is attributed to a robust rise in imports, which grew by 6.7 percent, overshadowing a mere 0.9 percent growth in exports.
The RBF noted that while all import categories experienced growth, mineral fuel remains the exception. Notable contributions came from machinery and transport equipment, especially road vehicles, food and live animals, as well as manufactured goods. Conversely, export growth saw only a slight increase, driven mainly by higher earnings from gold products, woodchips, and kava. However, this was dampened by declines in re-exports of mineral fuel and domestic exports of sugar and mineral water, significantly affecting overall export performance.
The RBF also reported that headline inflation reached zero percent in December, an improvement from the -1.4 percent observed in November and -0.2 percent in December the previous year. Price increases in categories such as alcoholic beverages, tobacco, yaqona, restaurants, hotels, and miscellaneous goods and services helped balance out the decreases noted in transport costs, cooking gas, fuel, and household equipment.
Overall, despite the challenges presented by the widening trade deficit, Fiji’s foreign reserves and stable inflation rates suggest a resilient economy capable of navigating through its current economic landscape.
Leave a comment