Ritika Pratap 
[Source: Tourism Fiji]
The International Monetary Fund in its latest release says that with the rapid rebound in tourism, the Fijian economy is experiencing a strong recovery.
Nevertheless, the IMF says significant risks to growth remain both on the demand side – due to the global outlook, and on the supply side – due to capacity constraints and price competitiveness.
According to the IMF tourist arrivals in 2022 reached 71 percent of 2019 levels, yielding GDP growth of an estimated 16.0 percent in 2022.
Tourist inflows are expected to approach pre-pandemic levels this year and IMF says this will revert to the long-term growth trend thereafter.
This tourism rebound will support momentum in the economy, with real GDP projected to grow by 7.5 percent in 2023 and 3.9 percent in 2024.
It says in the near-term, the Fijian economy is projected to grow above trend which is estimated at around 3¼ percent.
The IMF says inflation has eased since the end of last year, but risks are tilted to the upside, given strengthening domestic demand, growing wage pressures, and volatile global commodity prices.
The IMF adds inflation in Fiji has been contained, averaging 4.3 percent in 2022 and falling to two percent year-on-year in March 2023, due to the dampening effects of administered price controls and fiscal measures.
The IMF says the current account deficit remained high at 17.5 percent of GDP last year, as improving tourism receipts and strong remittances were offset by the impact of higher commodity prices and rising import demand.
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