Fiji’s economic landscape appears promising for the year 2024, with indicators suggesting favorable conditions for growth. According to the Reserve Bank of Fiji’s December 2024 Economic Review, broad money has experienced an expansion of 8.4%, while private sector credit has risen by 11.4%. This growth in lending demonstrates strong confidence among both businesses and households, with lending to businesses increasing by 10.9% and household lending growing by 13.3%.
The banking system remains well-capitalized, boasting liquidity levels of $2.4 billion as of late December. This solid liquidity backdrop has helped maintain historically low lending rates, despite a modest increase in time deposit rates due to the requirements of Basel III.
On the investment front, although activity has been somewhat sluggish, there are encouraging signs. New investment lending surged by 25.9%, indicating potential growth. However, the construction sector faced challenges, reflected in a 35.9% decline in the number of building permits issued. Nevertheless, the total value of these permits soared by an impressive 97.7%, attributed to rising construction costs and a scarcity of skilled labor.
The Reserve Bank of Fiji remarks that while growth is evident, the pace of investment remains cautious. This situation reflects a period of adjustment as businesses adapt to new economic realities and consider the long-term impacts of their investments.
In summary, while Fiji’s economy is developing positively, stakeholders must continue to monitor the investment climate and address structural challenges to sustain growth momentum.
Overall, there is an optimistic outlook for Fiji’s economic growth in 2024, as indicators show resilience and potential despite the current hurdles.
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