Fiji’s remittances are expected to reach approximately $1.34 billion by the end of this year if the current growth trend continues. These remittances have become the nation’s second-largest source of foreign exchange after tourism, having experienced significant growth during and after the COVID-19 pandemic, totaling $1.25 billion in 2023.
According to Shamal Chand, senior economist at Westpac Fiji, personal remittances saw a 5.0 percent increase, amounting to $622.2 million in the first half of this year. The majority of these funds were sent through mobile network operators (45 percent), money transfer operators (36.7 percent), and commercial banks (17.8 percent).
Chand indicated that if the current trends persist, remittances are projected to grow to approximately $1.34 billion by the end of 2024, reflecting a more modest growth rate of 6.9 percent, especially as migration trends are expected to slow down. This projection was shared in the Westpac Fiji quarterly economic update released this week.
He referenced the latest 2019-20 Household Income and Expenditure Survey (HIES), which revealed that the average household received $1,651.29 in remittances and gifts. Urban households typically received $1,866.10, while rural households averaged $1,372.80 annually.
Chand noted that one-fifth of remittances were directed to households in the highest income bracket, while only 4.3 percent went to the lowest income group. This disparity suggests that wealthier families are more likely to have relatives abroad who can send money back home.
In contrast, Chand mentioned that pensions and social benefits were distributed more evenly across different income groups. He pointed out that the effects of remittances on household income and spending patterns are not thoroughly analyzed, although the recent HIES report indicated that overall consumption trends leaned more towards non-food categories rather than food items.
“As household welfare improves, the proportion of expenditure on food typically decreases, reinforcing the notion that higher-income groups receive more remittances and allocate a larger share of their spending to non-food items,” Chand concluded.