Fiji: 2025 Article IV Consultation-Press Release; and Staff Report

International Monetary Fund

No 2025/138, IMF Staff Country Reports from International Monetary Fund

Abstract: The 2025 Article IV Consultation discusses that Fijian economic recovery continued in 2024. Monetary and financial conditions remain accommodative, while the fiscal stance has tightened. Growth was showing signs of slowing early in 2025. Tariffs will have additional effects, both directly on goods exports and indirectly through slowing external demand. On this basis, growth is projected at 2.6 percent in 2025, and to settle by 2027 and thereafter slightly below the pre-pandemic trend of 3.3 percent. The outlook is very uncertain. Rebuilding fiscal buffers should be a priority, with growth-friendly consolidation promoting a shift from current to capital spending. Social protection measures should be ready to shield the most vulnerable from a pronounced downturn. Monetary policy should be gradually adjusted to at least neutral levels and exchange restrictions phased out. Financial policies should be attentive to emerging credit risks and safeguard against money laundering risks. A significant increase in reform momentum is needed to boost growth over the medium term, with long term prospects dependent on addressing the impact of natural disasters and mobilizing additional climate financing.

Pages: 65
Date: 2025-06-20
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