Investment indicators in Fiji show generally positive performance, although a high-cost environment continues to impact activity, according to the latest economic review from the Reserve Bank of Fiji (RBF). The RBF reports a cumulative increase of 12.2% in new investment loans to March, with notable growth in sectors such as building and construction (39%) and second-home purchases (around 80%).
Domestic cement sales also experienced an 8.6% rise during the same period, buoyed by sustained market demand. Despite these encouraging figures, the RBF observed that the prices of building materials remain high, registering a 3.8% increase year-on-year in the first quarter of 2025, contrasting the decline seen during the same period in 2024.
A February 2025 Business Expectations Survey revealed that medium-term business sentiment towards investing in plant and machinery has increased compared to previous surveys. However, short-term investment plans for buildings over the next year have declined from previous levels. Overall, while businesses display optimism about future conditions according to the February BES, this outlook is tempered by a modest decline in sentiment compared to earlier assessments.
The preceding economic reviews in December 2024 highlighted similar trends in Fiji’s economic landscape, noting a robust financial framework with an 8.4% increase in broad money supply and an 11.4% surge in private sector credit. Although investment activity faced challenges, such as a significant 35.9% decrease in the number of building permits issued, the total value of successful permits skyrocketed by 97.7%, indicating rising construction costs and a shortage of skilled labor.
These insights suggest a cautious yet hopeful trajectory for Fiji’s economic landscape, underpinned by increasing confidence in the private sector. As businesses navigate complexities in the investment environment, continued focus on addressing challenges in labor and construction costs may yield a more robust growth pattern in the future.
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