Fiji’s remittances have risen since 2022, with total private flows up by 15.4 percent $871m in the year to June, before surging to $1,095m in 2023 and to $1,231bn in 2024.

Most of this rise is from the rapidly expanding Pacific Australia Labour Mobility scheme.

However, ANZ Pacific Economist Dr Kishti Sen says they forecast that remittances will grow further in 2024-25, but that will be about as good as it gets for a while.

According to Dr Sen, the flow of overseas migration is reversing, as the need for extra workers in Australia and New Zealand has run its course.

He adds that the number of students moving from Fiji to Australia declined sharply in 2023-24, while new PALM arrivals have also dropped off significantly.

Dr Sen says this trend, together with students returning after completing courses, is likely to result in net overseas migration adding to Fiji’s population from the second half of 2025.

He highlights that on a cumulative basis, Fiji’s population loss due to overseas migration will fall from 2025-26, limiting the upside to remittance growth.

However, he stresses that will be more of a sideways story than a downtrend.

According to Sen, PALM scheme numbers in Australia could stabilize at current levels as workers can stay for up to four years.

The ANZ Economist says that if the number of new PALM arrivals picks up significantly, remittances may move higher.

Rising PALM worker numbers bolstered remittance growth in Fiji, an important source of income for many Fijian households.

Dr Sen says higher remittances improve household disposable income, support consumer demand and add to foreign exchange reserves.

Remittances now constitute about 10% of Fiji’s GDP, more than double the 4.6% of 2019.

About 15% of household budgets, on average, are supported by remittances.

Sen states that traditionally, this ‘family bank’ has also helped stabilize demand during periods of economic shock, particularly covering loss of employment, as was the case in 2016 after Cyclone Winston and at the height of the pandemic in 2020 and 2021.

Sen adds that over time and outside of external events, though, remittances have largely increased in line with the growth in overseas migration mostly of permanent migrants.