Fiji’s merchandise trade deficit widened in January as exports slumped and imports edged higher, the Reserve Bank of Fiji (RBF) reported in its April Economic Review. The trade shortfall grew 4.8 percent to $473.2 million after total exports fell 8.7 percent to $190 million and imports rose 0.4 percent to $663 million, with the Fiji Bureau of Statistics providing the underlying data.
By value, the United States remained Fiji’s largest market in January, led by shipments of mineral water, kava and turmeric. However, export receipts fell for four of Fiji’s top five destinations — the US, China, Australia and New Zealand — with only the United Kingdom registering an increase, driven largely by sugar exports. The RBF attributed the overall export decline principally to weaker mineral water shipments and a drop in re-exported commodities, even though exports of gold dore and concentrates posted gains.
On the import side, purchases from China, Australia and New Zealand rose in January, while values fell for imports from Singapore and Japan. Fiji’s imports continue to be dominated by building materials and fertiliser from China, food and electronic goods from Australia and New Zealand, motor vehicles from Japan and fuel from Singapore, according to Fiji Bureau of Statistics classifications cited by the central bank. RBF noted that the modest import growth was underpinned by higher imports of manufactured goods as well as food and live animals.
The RBF flagged the January outcome as one to watch amid mounting external risks. In its review the central bank warned that the ongoing conflict in the Middle East is a significant source of risk to both global and domestic economic outcomes, having already driven “sharp increases” in oil prices with spillovers to chemicals, technology-related equipment and global food markets. That, the RBF said, could put additional pressure on Fiji’s foreign exchange position in the coming months by pushing up the country’s import bill.
The warning comes as the government prepares for its 2024-25 Budget and continues to emphasise debt sustainability. Finance Minister and Deputy Prime Minister Biman Prasad has in recent statements underlined the need to manage and repay public debt — a background concern that makes external trade dynamics and potential fuel price shocks particularly consequential for fiscal planning and reserve buffers.
RBF reiterated that the ultimate impact on the Fijian economy will depend on the duration and severity of the conflict in the Middle East. With the ceasefire fragile and risks of extended hostilities still present, the central bank said its monitoring of external trade movements and foreign exchange developments will remain intensive in the months ahead.