Fiji’s economy has demonstrated resilience and growth despite facing some industry-specific challenges throughout the year. The Reserve Bank of Fiji (RBF) revealed that visitor arrivals increased by 0.3 percent, reaching 901,372 by November, a testament to the nation’s ongoing appeal as a travel destination. This slight upward trend was bolstered by rising visitor numbers from the United Kingdom (11.3 percent), the United States (10.2 percent), continental Europe (6.8 percent), and neighboring Pacific Island countries (3.2 percent). However, this growth was somewhat tempered by a decline in visitors from New Zealand (-2.9 percent), Australia (-0.8 percent), and Asian markets (-6.8 percent).
In terms of local production, the timber industry saw significant improvements, with pine wood output surging by 69.5 percent and mahogany production climbing by 53.5 percent, driven by favorable weather conditions. Additionally, the RBF noted a 0.5 percent increase in electricity production, attributed to a 1.8 percent rise in new customers, with renewable sources contributing 53 percent of total energy generation.
However, challenges arose in other sectors. Mineral water output fell by 10.6 percent due to decreased demand from the US and scheduled maintenance in November. Gold ore production also took a notable hit, declining by 28.2 percent as a result of substantial drops at Vatukoula Gold Mines Limited, which reported a staggering 62.4 percent decline.
Sugar production faced its challenges as well, dropping by 12.7 percent despite a significant 8 percent increase in cane supply. This decline was largely attributed to poor cane quality, operational issues, and adverse weather.
In a more positive light, consumer activity remained strong, supported by a lower value-added tax (VAT) rate. By November, new consumption lending surged by 24.3 percent to $2.1 billion, largely driven by the wholesale, retail, hotels, and restaurants sectors. Pay-as-you-earn (PAYE) tax collections also rose by 14.8 percent, reflecting rising wages, while inward remittances increased by 4.3 percent up to September, further energizing consumption.
Investment activity showed promising signs, as the RBF reported improvements despite a 25.1 percent decline in the number of completion certificates issued. The value of these certificates, however, saw a remarkable increase of 167.8 percent by the third quarter, indicating a shift toward higher-cost projects and successful execution of significant construction initiatives.
The financial sector displayed favorable conditions, with broad money expanding by 10.1 percent in November, primarily driven by a 9.2 percent increase in private sector credit. The RBF noted that the banking system liquidity was robust, maintaining around $1.9 billion as of December 30, which contributed to low interest rates, with the outstanding lending rate stable at 4.50 percent in November.
Overall, while some sectors faced challenges, the positive indicators across tourism, consumption, and investment suggest a hopeful outlook for Fiji’s economic future.
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