Fiji Islands: Economic Outline
Fiji stands as the second-largest economy in the Pacific, marked by advanced industrialization and serving as a hub for re-exports. However, its susceptibility to natural disasters poses a significant constraint on growth. Over the period of 2010-2019, economic growth averaged 3.3%. Despite a full recovery from the pandemic's impact, Fiji now faces the challenge of high debt levels and limited fiscal reserves, as the country relies heavily on tourism. The economy has fully recovered with a 28% cumulative growth during 2022-2023, driven by a swift tourism rebound exceeding 4% above 2019 levels by the end of 2023. Approximately 50% of the growth during 2022 and 2023 came from the accommodation, transport, manufacturing, wholesale, retail, and finance sectors. According to the World Bank, growth is expected to slow down in the medium term, with projections averaging 3.3% in 2025-2026. This moderation will be supported by the manufacturing, wholesale and retail trade, and finance sectors. The deceleration is attributed to the gradual subsiding of the initial post-pandemic demand boost for tourism, coupled with constraints on new source markets due to limited hotel capacity.
The fiscal deficit decreased to 5.1% of GDP in 2023 from an average of 11.6% in 2020-22, driven by high tax buoyancy and reduced capital transfers. Revenue measures introduced in 2023 contributed gains equivalent to around 3.3% of GDP, partially offset by higher public spending. The deficit was financed through external concessional and domestic borrowing. Despite these fiscal dynamics, public debt decreased to 80.6% of GDP in 2023 due to a declining primary balance and robust economic growth. The deficit is expected to narrow to 4.5% of GDP by 2026 due to revenue-generating reforms and expenditure rationalization. The Government intends to review tax expenditure, advance the investment appraisal and selection process, and freeze nominal spending over the medium term. Public debt is projected to hover around 80% by 2026. According to the World Bank Debt Sustainability Analysis 2024, public debt is assessed as sustainable but subject to significant risks. Inflation in Fiji has historically remained lower compared to global levels due to price controls and various mitigation measures. However, the consolidation of 9% and 15% VAT rates in August 2023, alongside increased import prices and tariff rates, resulted in a 5.1% year-on-year headline inflation in December, the highest in the last decade. Subsequently, it decreased to 3.6% in January 2024. Headline inflation is forecasted to converge towards 3% over the medium term as global inflationary pressures diminish (World Bank).
According to figures from the World Bank, GDP per capita (PPP) reached USD 14,632 in 2022 and the growth outlook is anticipated to decrease poverty to below pre-pandemic levels, reaching 49.9% in 2024. At the end of 2023, the World Bank estimated unemployment at 4.2%, down from 1.6% one year earlier.
| Main Indicators | 2022 | 2023 (E) | 2024 (E) | 2025 (E) | 2026 (E) |
|---|---|---|---|---|---|
| GDP (billions USD) | 4.98 | 5.50 | 5.80 | 6.10 | 6.44 |
| GDP (Constant Prices, Annual % Change) | 20.0 | 8.0 | 3.0 | 3.4 | 3.4 |
| GDP per Capita (USD) | 5,462 | 5,993 | 6,287 | 6,575 | 6,898 |
| General Government Gross Debt (in % of GDP) | 91.0 | 82.7 | 81.1 | 80.6 | 80.2 |
| Inflation Rate (%) | 4.3 | 2.3 | 4.0 | 3.2 | 3.1 |
| Current Account (billions USD) | -0.86 | -0.26 | -0.37 | -0.42 | -0.48 |
| Current Account (in % of GDP) | -17.3 | -4.7 | -6.3 | -6.8 | -7.4 |
Source: IMF – World Economic Outlook Database - October 2021.
Note: (e) Estimated Data
| Monetary Indicators | 2016 | 2017 | 2018 | 2019 | 2020 |
|---|---|---|---|---|---|
| Fiji Dollar (FJD) - Average Annual Exchange Rate For 1 GBP | 2.83 | 2.66 | 2.78 | 2.75 | 2.78 |
Source: World Bank - Latest available data.
| Breakdown of Economic Activity By Sector | Agriculture | Industry | Services |
|---|---|---|---|
| Employment By Sector (in % of Total Employment) | 28.9 | 14.7 | 56.4 |
| Value Added (in % of GDP) | 9.2 | 17.6 | 50.3 |
| Value Added (Annual % Change) | 5.5 | 22.1 | 9.7 |
Source: World Bank - Latest available data.
| Socio-Demographic Indicators | 2024 (e) | 2025 (e) | 2026 (e) |
|---|---|---|---|
| Unemployment Rate (%) | 5.0 | 4.7 | 4.5 |
Source: IMF – World Economic Outlook Database - Latest available data
| 2018 | 2019 | 2020 | |
|---|---|---|---|
| Labour Force | 359,388 | 362,136 | 357,260 |
Source: International Labour Organization, ILOSTAT database
| 2017 | 2018 | 2019 | |
|---|---|---|---|
| Total activity rate | 60.50% | 60.37% | 60.29% |
| Men activity rate | 79.52% | 79.32% | 79.22% |
| Women activity rate | 40.75% | 40.69% | 40.62% |
Source: International Labour Organization, ILOSTAT database
The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.
Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation
See the country risk analysis provided by Coface.
The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.
Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House
The world rankings, published annually, measures violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire incorporating the main criteria (44 in total) to assess the situation of press freedom in a given country. This questionnaire was sent to partner organisations,150 RWB correspondents, journalists, researchers, jurists and human rights activists. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).
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Latest Update: May 2024
