Aerial shot of Suva City.

Fiji’s economy is anticipated to undergo a notable slowdown, projected at around three percent in the medium term, extending beyond 2023.

According to ANZ International Economist Kishti Sen, despite Fiji’s commendable growth in recent years, the outlook for the next two to three years might not mirror the same robust performance.

He says the projection of a more moderate economic pace is attributed to anticipated constraints in visitor arrivals, particularly from key trading partner countries such as Australia, New Zealand, and the USA.

Sen noted that households in these nations are expected to exercise caution due to sustained higher interest rates, leading to a belt-tightening approach that could impact tourism.

Sen highlighted that Fiji’s tourism sector is already operating at full capacity, and with limited investment in hotel room inventory over the past decade, there is restricted potential to accommodate a significant influx of visitors during the forthcoming peak seasons.

In light of these challenges, Sen stressed the urgency for non-tourism sectors to assume a more significant role as drivers of economic growth.

He particularly pointed out opportunities for the development of downstream processing of commodities as a potential avenue for diversification.

“Fiji can do a lot more downstream. You know, we produce a lot of commodities here, but we almost always export them in their raw form. So downstream processing basically means you add your value to the commodities that you produce and sell or export something close to the finished product. So where are the other options? And the other options are in agriculture, forestry, and fishing.”

Sen’s analysis underscores the need for Fiji to expedite its shift towards a more balanced economy, diminishing its reliance on tourism.

He is also projecting growth of 3.3 percent in the coming year and 3.1 percent in 2025.