The Fijian economy is well on track to rebound in 2022 with Westpac Fiji expecting real GDP to grow by 12.7 per cent this year.
In its publication Westpac Wave, the bank’s senior economist Krishal Prasad said the growth forecast was led by a turnaround in most sectors of the economy, particularly those linked to the tourism sector.
Mr Prasad said the growth in real GDP had been revised marginally lower because of the impact of higher consumer prices.
According to the report while Fiji is making good strides in its recovery process and has implemented strategies to normalise economic activity, challenges and risks remain.
“The main challenge right now is to continue to grow the economy while keeping inflation contained as the impact of the Russia-Ukraine war continues to weigh on broadening price pressures that threaten real income and consumer demand,” he said.
According to the report natural disasters and the upcoming general election also pose some downside risks to the growth outlook and could derail the expected recovery of the Fijian economy however he said for now, Fiji was well placed for a double-digit growth outcome in 2022.
In the report Mr Prasad continued to say that in Fiji, reopening momentum after emerging from the Covid lockdowns of last year was strongly evident in 2022, adding that consumer spending showed strong gains this year, despite some Covid disruptions early in the year.
Mr Prasad said the economy’s underlying strength remained the recovery of the tourism industry, where conditions continued to be robust.
He said while this dynamic had further to run and would likely drive strong growth this year, a significant inflation challenge was now affecting households, pointing to a marginal loss of economic momentum from mid-2022 to 2023.
