17 April, 2018, 12:00 am
ECONOMIC growth for Fiji is projected to slow down slightly from 3.9 per cent last year to 3.6 per cent in this year and 3.3 per cent in 2019 as most cyclone construction activity ending soon.
Newly released Asian Development Bank’s 2018 Asian Development Outlook report stated that after a steep growth slowdown in Fiji in the wake of Tropical Cyclone Winston in 2016, reconstruction spending, improved agricultural output, and tourism growth spurred recovery.
According to the report all sectors are expected to grow, however, with major contributions from public administration, wholesale and retail trade, manufacturing, agriculture, accommodation and food services, and construction.
It said high investment lending in 2017 and a number of ongoing tourism investments suggested that the private sector will generate higher tourism numbers with growth at 3.3 per cent in 2019 expected to be broad based, with tourism, agriculture, and construction expected to be the major contributors.
Touching on government’s investment in infrastructure projects, the report said while capital expenditure was likely to continue to be constrained by limited implementation capacity in government agencies, public infrastructure investments were expected to facilitate additional private construction able to support growth over the next couple of years.
Meanwhile the report also indicated that exports were expected to grow strongly as agriculture, especially tree crops, recover from cyclone damage.
It said with higher earnings from tourism and remittances, the current account deficit was forecast to narrow to 5.0 per cent of GDP in 2018 and 4.8 per cent in 2019.
According to the report the government aims to improve implementation capacity through a number of reform initiatives and partnerships with the private sector.
It said tourism was on track for another record year, with benefits from new direct flights to Japan and increased flights to Singapore and San Francisco.
Inward remittances are expected to continue growing in 2018 in tandem with higher exports of athletic talent and seasonal labour, as well as military deployments on peacekeeping missions.
Inflation is expected to moderate in 2018 and 2019.
Rising international prices for fuel and food and higher taxes on alcoholic beverages and tobacco are expected to be offset by lower domestic food prices as the agriculture sector recovers from the impacts of Cyclone Winston.