Ongoing geopolitical tensions and economic challenges are impacting what the Reserve Bank of Fiji (RBF) believes could otherwise be a resilient global economy. In its December 2024 economic review, the RBF reported that while easing inflationary pressures have allowed for some normalization of monetary policy across major economies, this development is tempered by significant risks.

Among the primary concerns outlined in the review are slow growth among key trading partners, particularly New Zealand’s recent recession, which poses substantial implications for Fiji, especially regarding inward remittances and tourism, both crucial elements of its economy. The RBF warns that escalating import prices can undermine consumer purchasing power and place additional strain on local businesses that are dependent on imports.

Nevertheless, there are positive indicators for the broader economic outlook. The ongoing strong performance of the tourism industry alongside the initiation of various infrastructure projects scheduled for the coming year could provide the necessary boost to support economic resilience. Notably, the tourism sector remains robust, which could play a vital role in mitigating some of the adverse impacts stemming from external factors.

In summary, while Fiji grapples with significant external challenges, the strength of the tourism sector and the potential for new projects provide a hopeful outlook for economic recovery. The RBF’s nuanced perspective underscores the importance of strategic navigation through these challenges, suggesting that with careful planning, Fiji may foster a more stable and prosperous economic future.