Fiji’s economic outlook appears promising as it anticipates substantial growth in the coming years, thanks to a rebound in tourism. According to Krishna Srinivasan, the Director of the Asia and Pacific department at the International Monetary Fund (IMF), Fiji’s real Gross Domestic Product (GDP) is projected to grow by 7.5 per cent in 2023 and 3.9 per cent in 2024. This optimistic projection was shared during the launch of the IMF’s latest regional economic outlook for Asia and the Pacific in Singapore on October 18.
Srinivasan attributed this growth partly to the significant resurgence in tourism arrivals, which have brought Fiji back to the levels seen in 2019 before the multiple shocks faced by the country. In fact, Fiji stands out as a success story in terms of recovery from these shocks. Recent meetings between the IMF and Fiji’s delegation in Marrakesh, Morocco, have been positive, with Fiji demonstrating a clear reform agenda geared towards ensuring the country’s macro fiscal stability in the years to come.
Srinivasan underscored the importance of keeping inflation in check, recommending that regional countries continue monetary tightening until inflation returns to its target level. This approach is crucial to controlling inflation and maintaining economic stability.
The IMF’s latest regional economic outlook report highlights that inflation patterns vary across the Asia and Pacific region. In advanced economies like Australia, Korea, New Zealand, and Singapore, inflation trends align with those in the United States and the euro area. Inflation initially dipped during the early stages of the pandemic but has since steadily increased. Notably, producer price index and imported inflation have played a significant role in driving Consumer Price Index (CPI) inflation.
On the other hand, several low-income and emerging markets in the region, including Fiji, have experienced less pronounced increases in inflation compared to previous economic cycles. This suggests a degree of resilience in these economies, which is positive news for Fiji’s ongoing economic recovery.