Growth among 11 Pacific island nations, including Fiji, has slowed to an estimated 3.6 percent this year, down from 5.8 percent in 2023. The World Bank’s October Pacific Economic Update, released in Suva, highlighted that Fiji, which accounts for over half of the region’s output, played a significant role in this slowdown, alongside the Solomon Islands, facing structural challenges.
The report indicates that nearly half of the Pacific island countries, including the largest economies—Fiji and the Solomon Islands—are projected to experience slower growth in 2024 compared to the previous year. However, growth in other countries, excluding Fiji, has risen from 3.6 percent in 2023 to an estimated 4.1 percent this year, largely due to strong tourism and remittance-driven economies.
Titled “Diminishing Growth amid Global Uncertainty: Ramping up Investment in the Pacific,” the report also noted a significant decrease in inflation across the region, with the median rate falling from 6.8 percent in 2023 to 4 percent in 2024. For Fiji, inflation is anticipated to average 3.6 percent in 2025-26, following a temporary spike in 2024 attributed to tax adjustments. Despite this, high previous inflation has kept the cost of essential goods elevated.
Furthermore, the report revealed an improvement in fiscal balances as a share of GDP in several Pacific island countries, although medium-term growth prospects have decreased from an average of 3.2 percent in 2000-2019 to 2.7 percent in 2020-2029, influenced by the rise in natural disasters, climate change effects, and weak investment. To stimulate medium-term growth, the Pacific region will need to implement strategies aimed at generating sustainable investment.