Westpac Fiji has updated its growth forecast for the nation, increasing it from 2.5 percent to 3.0 percent for the current financial year. In a quarterly economic update released yesterday, senior economist Shamal Chand indicated that Fiji is on track for another year of strong economic growth.
Chand highlighted that preliminary indicators suggest significant activity within the tourism sector, along with positive performances in construction, investment, and private sector credit growth. This revision stems from a boost in tourism, favorable investment and construction opportunities, a rebound in manufacturing, solid wholesale and retail sales, and fiscal measures included in the 2024-2025 National Budget.
He noted, “The provisional growth figures for 2023 fell short of our initial expectations, prompting us to revise this year’s growth rate upwards.” Chand also predicted that economic growth would stabilize at around 3.4 percent starting in 2025, which is in line with historical averages.
Key indicators from the Reserve Bank of Fiji (RBF) suggest considerable growth through August this year, including an 11.0 percent increase in electricity production and a 10.1 percent rise in consumption. Additionally, gold production surged by 30.3 percent, cane production grew by 18.3 percent due to the harvesting season, and cement production and sales increased by 6.6 percent and 7.6 percent, respectively. Domestic credit rose by 6.8 percent, while private sector credit saw an 11.6 percent increase, reflecting a strong appetite for borrowing and investment.
“This gives us further confidence in updating our economic outlook for this year. With one quarter remaining, we are heading into 2025 on a positive note, and the current momentum is expected to continue into the new year,” Chand said.
He emphasized that several major investment projects are in the works and ongoing expansion plans in the tourism sector, coupled with decreasing resident departure numbers, will be vital for Fiji to achieve a growth rate exceeding 3 percent in the medium term.