Fiji’s economic growth is now revised to 3.2 percent for the year, a slight decline from the previous forecast of 3.4 percent. This adjustment was unveiled by the Reserve Bank of Fiji’s (RBF) Macroeconomic Committee after evaluating several challenges impacting the economy, including ongoing global trade tensions, geopolitical issues, and revised growth expectations for Fiji’s trading partners.
RBF Governor Ariff Ali, who leads the committee, noted that despite these hurdles, key indicators such as domestic VAT collections, employment rates, remittances, and bank credit have shown significant growth, supporting a positive economic outlook. “Consumption remains strong, backed by an accommodative monetary policy that is encouraging investment activity,” Ali commented.
While the service sector continues to be the primary engine of growth, there are concerns regarding visitor arrivals, initially predicted to grow by 4.0 percent but are now expected to remain flat in 2025. This downturn comes following the impressive rise in arrivals last year, which had set a benchmark for expectations.
Economists, including ANZ Group’s Senior Economist Dr. Kishti Sen, have expressed a cautious yet optimistic view of Fiji’s economic landscape. He indicated that while the growth rate may dip slightly, consumer demand remains critical to maintaining a stable GDP. Factors such as increasing wages and secure remittances are seen as positive drivers for continued consumer spending.
Looking ahead, the committee anticipates broad-based growth returning to long-term trends of around 3.0 percent by 2026 and 2027, primarily fueled by ongoing governmental expenditure and strong domestic consumption. In particular, the expected National Budget is likely to foster further growth by supporting demand in important sectors like public administration, transport, accommodation, and manufacturing.
Overall, while the global economic outlook presents challenges, the resilience and adaptability of Fiji’s economy lend hope for a robust recovery and growth in the near future. This outlook remains positive, especially in light of strategic planning and investments aimed at enhancing production, diversifying exports, and bolstering private sector projects. By focusing on strengthening its agricultural sector and improving market access for smallholder farmers, Fiji is paving the way for sustainable economic performance moving forward.
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