RBF revises Fiji's GDP growth for 2019
May 10, 2019 4:38 pm
The slowdown effect from the global economy has seen the Reserve Bank of Fiji revise the projected growth of the real gross domestic product for 2019.
The GDP is now forecast to grow by 2.7 percent, down from the earlier projection of 3.4 percent.
RBF Governor Ariff Ali says the revised lower growth reflects moderation in domestic economic activity and is in line with the slowdown anticipated for the global economy.
The International Monetary Fund, in its April World Economic Outlook downgraded the global growth forecast for 2019 to 3.3 percent from the previous forecast of 3.5 percent.
World Bank earlier this year had also predicted that that global growth is expected to slow to 2.9 percent in 2019.
This is due to the international trade and investment moderating, trade tensions remaining elevated, in the forefront of which is the battle between the US and China and financing conditions are tightening.
The growth in emerging market and developing economies has lost momentum and is projected to stall at 4.2 percent this year, and the latest figures rake it at 4.4 percent.
The advance economies are at 1.8 percent.
After strong growth in 2017 and early 2018, global economic activity slowed notably in the second half of last year, reflecting a confluence of factors affecting major economies.
Ali says despite this they remain confident that the agriculture, manufacturing, information and communication, accommodation and food services and the wholesale and retail trade sectors are expected to contribute positively to domestic economic growth.
The favourable performance of the agriculture sector is envisaged to be driven by an increase in cane production coupled with increases anticipated in the production of most agricultural crops and livestock.
Following a decline in 2018, a turnaround is anticipated for sugar manufacturing in anticipation of higher production given the absence of any major natural disasters so far this year.
In addition, while the tourism sector will continue to contribute positively to economic growth, a deceleration in visitor arrivals is envisaged.
The mining sector, however, is projected to contract due to lower gold production forecast for Vatukoula Gold Mine as a consequence of the consecutive declines noted in gold production in the first three months of the year.
Activity in the construction sector is also expected to moderate following the completion of the reconstruction of schools and buildings damaged by TC Winston.