Fiji’s economy is expected to grow by 3.8 per cent , up from the previous forecast of 2.8 per cent, reflecting a stronger-than-expected recovery.

Finance Minister and Deputy Prime Minister Professor Biman Prasad attributes this improved performance to key fiscal and monetary reforms that are helping to stabilize the economy and build a foundation for long-term resilience.

The government’s economic strategy, he states includes measures such as VAT consolidation, higher corporate taxes, and budget adjustments, steps that have sparked debate but are aimed at addressing fiscal imbalances.

“Contrary to some of the critics you know that cannot digest good news about the economy, the economy in 2024 and that is reflected in the independent macro-economic committee forecast.”

While these decisions were controversial, Prof Prasad believes they are necessary to secure sustainable growth.

In addition to these structural reforms, he said that the government has also introduced programs aimed at supporting household consumption.

Wage increases, civil service salary adjustments, and the $200 back-to-school initiative are boosting disposable incomes, which in turn is driving demand and economic activity.

Over 200,000 students, Prof Prasad said benefited from the back-to-school program which is seen as a targeted effort to alleviate financial pressures on families.

Fiji’s tourism sector and remittance flows, he said projected to reach $1.3 billion this year are helping to further fuel economic momentum.

Investment lending has also surged by 25 percent, signaling a renewed confidence among businesses.

These factors, Prof Prasad combined are contributing to Fiji’s positive economic trajectory, despite global economic challenges like slower growth in major trading partners, Australia and New Zealand.

Prof Prasad pointed out that while global pressures remain, Fiji’s fiscal policies have positioned the country to weather external uncertainties.

Inflation, he said was expected to ease with the country set to experience its lowest inflationary pressures since 2021, offering further proof of the success of these economic measures.

Critics have questioned whether these policies are sustainable in the long run, but Prof Prasad remains confident that they are designed to balance short-term relief with long-term stability.

The government’s approach is to provide immediate support for vulnerable groups while creating a solid foundation for future growth.

Prof Prasad urged Fijians to look at the bigger picture and evaluate the long-term impact of the government’s efforts.