Fijian economy has shown positive growth in the last 12-months – PM

Prime Minister Sitiveni Rabuka says the Fijian economy has shown positive growth in the last 12-months after consecutive contractions since 2019.

While delivering his National Address, Rabuka says the latest outlook for global economic growth this year by the International Monetary Fund has been revised downward from 3.3 percent to 2.7 percent.

He says the downward revision was based on the continuing war in Ukraine and tensions in the Taiwan Strait, which has impacted the global supply chain.

He also says in 2019 the real output contracted by 0.6 percent, in 2020 by 17 percent and in 2021 by 5.1 percent. Rabuka adds that in total, Fiji’s economy contracted by more than 22 percent from 2019 to the end of 2021, however, if people recall, the economy almost came to a complete stop, at the height of the pandemic.

He also adds that the complete shutdown brought unprecedented hardship to our people.

The Prime Minister says in 2022, the economy was estimated to have rebounded by 15.6 percent, fuelled by the recovery in tourism and associated sectors.

He further says this rebound in tourism catalysed the recovery of other sectors of the economy.

Rabuka adds this year, the economy is projected to expand further by 8 percent and it is projected to grow by 4 percent in 2024.

He says the Reserve Bank of Fiji revised its projection upwards to 8 percent due to the positive performance in some of the key sectors in the first half of this year.

He says the improvement has been boosted by high level of remittances from friends and relatives abroad.

He further says remittances in 2022 surpassed the $1 billion mark and he acknowledges our citizens and former citizens overseas for their contribution to their families back home.

The Prime Minister says it is notable that other productive sectors particularly the resource-based sectors have remained subdued.

He says we must continue to incentivize our resource-based sectors so that they can effectively contribute to economic growth and support the effective participation of resource owners in the socio-economic development of the nation.

He adds that some of these sectors need urgent government support to improve their performance.

Rabuka says cabinet has approved some initiatives to improve performance in these sectors and the Budget announcement tomorrow includes measures in this regard.

He says while electricity generation rose in the last 12-months, gold, woodchip, timber and mahogany productions have declined.

He also says the demand for labour has increased while seasonal employment schemes and the outward migration of labour, both skilled and unskilled, is a serious concern for Government and employers.

Rabuka adds sugar production is likely to improve slightly this year and they plan to expand sugarcane production beyond 1.8 million tons.

The Prime Minister says extensive consultations are underway with their development partners to induct new innovative technologies to improve productive capacity through value addition.

He also says PAYE tax collection has grown in the last 12-months by approximately 20 percent, denoting higher personal wages and income. The PM adds that this is encouraging but we need to do more since we are only just rising from the pit we fell into during COVID-19 and poor management of the economy by the previous Government.

Rabuka says although the economy has shown growth in the last twelve months due primarily to the tourism sector, Government now needs to consider some hard decisions, to keep us on that trajectory.

He is also pleading for the people’s understanding as this may require some sacrifices and our collective commitment.