Fiji’s economy is reported to be in a strong position, according to Dr. Kishti Sen, ANZ’s Pacific economist. He noted that the domestic economy is performing “quite well,” with a projected GDP growth of 3.4 percent for this year.
Dr. Sen highlighted that private investment will be the key driver for economic growth as the country heads into the second half of this year and into 2025 and 2026. While he praised the notable rebound in international visitor arrivals following the pandemic, which helped Fiji return to 2019 tourism levels quickly, he indicated that the contribution of tourism to GDP growth is expected to decline.
“The economy is not going to fall off a cliff; rather, tourism’s impact on GDP growth will taper off,” Dr. Sen explained during a media roundtable at ANZ’s headquarters in Suva. He pointed out that Fiji’s accommodation sector is already at capacity.
However, Dr. Sen expressed optimism about the performance of the domestic economy, noting that domestic demand might be somewhat soft due to many Fijians relocating abroad for a minimum of 12 months. Despite this, he anticipated that retail sales would rebound in the latter half of the year.
He suggested that expected wage inflation would lead to stronger consumer demand, which would, in turn, enhance household spending. Furthermore, Dr. Sen predicted a rise in private investment next year, attributing this to the certainty provided by the Government through its policies and legislation.
He emphasized that increased private investment would generate jobs and enhance household financial power. “With consumer demand steady, private investment on the rise, and increased Government spending, the domestic economy is positioned well,” he concluded.