RBF Governor predicts 2024 to be challenging

February 1, 2024 4:41 pm

Reserve Bank of Fiji

Reserve Bank of Fiji Governor Ariff Ali says 2024 is expected to be a challenging year.

Ali says the Fijian economy is projected to decelerate as the substantial growth in tourism and consumption will taper off.

The projections come as the Fijian economy rebounded strongly over the last two years supported by the impressive recovery in the tourism industry.

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Ali says the 929,740 visitor arrivals last year set a new record, surpassing the 2019 level by four percent and the previous year by 46.1 percent.

He says the tourism-led boost to the economy improved employment prospects and raised incomes which were also complemented by a new record inflow of remittances standing at $1.25b,

But this year is expected to be challenging according to Ali due to a slowdown in the tourism industry as well as continued loss of skilled and semi-skilled workers.

Ali says this loss will adversely affect productivity and translate to lower domestic demand at the same time.

Apart from this the annual headline inflation rate was 5.1 percent in December, reflecting the effect of higher VAT and tariff rates as well as the pass-through of imported food and energy prices.

However, Ali says inflation is expected to moderate to three percent by the end of this year as the effects of the tax increases subside and the positive impact from retreating global food and energy prices are realised.