Westpac Fiji has increased its growth forecast for the country from 2.5 percent to 3.0 percent for the current financial year. This assessment was made by senior economist Shamal Chand in the bank’s quarterly economic update released yesterday, emphasizing that Fiji is on track for another year of solid growth.
Chand noted that early indicators highlight significant activity in the tourism sector as well as strong performances in construction, investment, and private sector credit growth. The upward adjustment in the growth forecast is attributed to a boost in tourism, promising investment and construction opportunities, a rebound in manufacturing, favorable wholesale and retail sales, and the fiscal stimulus outlined in the 2024-2025 National Budget.
“Since the provisional growth figures for 2023 were lower than anticipated, this has led to an upward revision of this year’s growth rate,” said Chand. He anticipates that economic growth will stabilize at 3.4 percent from 2025 onward, a figure consistent with historical averages.
Chand pointed to key partial indicators from the Reserve Bank of Fiji, showcasing considerable growth until August of this year, including:
– An 11.0 percent increase in electricity production and a 10.1 percent increase in consumption.
– A 30.3 percent surge in gold production.
– An 18.3 percent rise in cane production as the harvesting season commenced.
– A 6.6 percent increase in cement production and a 7.6 percent rise in cement sales.
– A 6.8 percent growth in domestic credit.
– An 11.6 percent increase in private sector credit, indicating a strong appetite for borrowing and investment in the market.
“This gives us further confidence in enhancing our economic outlook for this year. With one quarter remaining this year, we are entering 2025 on a strong note, and the current momentum is expected to persist into the new year.”
He concluded that with several significant investment projects on the horizon and ongoing expansion plans within the tourism sector, combined with decreasing resident departure numbers, Fiji is well-positioned to achieve growth rates above 3 percent in the medium term.