Tue, 07 Dec 2021

SUVA, Nov. 25 (Xinhua) -- Fiji is seeing the economic upturn mainly due to the higher vaccination rates of target population in the island nation.

Fiji has a population of around 900,000 people. So far, 90.4 percent of its target adult population have been fully vaccinated against the COVID-19, while 97.2 percent have received one dose of COVID-19 vaccines, according to the country's health ministry.

Fiji's economy contracted by 19 percent last year mainly due to the outbreak of COVID-19, which has so far killed 695 people in the country.

However, according to a statement issued by the Reserve Bank of Fiji (RBF), the country's central bank, on Thursday, the bounce-back in Fiji's domestic economic activity is underway, although it remains below pre-pandemic levels.

"The economic upturn is largely aided by the achievement of the target vaccination rates leading to the relaxation of COVID-19 protocols and ensuing rebound in mobility, alongside monetary and fiscal policy support," the bank said.

Domestic demand is gradually firming up as shown by the positive movements in certain partial indicators of consumption and investment in October, according to the bank.

Hiring intentions as per the RBF Job Advertisements Survey are also showing signs of recovery, with the monthly increase in the number of vacancies advertised since July this year.

Meanwhile, in the financial sector, the decline in outstanding private sector credit slowed further as commercial banks new loans cumulative to October grew compared with the same period last year.

Ariff Ali, RBF governor, said on Thursday that the resumption of international travel and tourism to Fiji is expected to fuel a stronger economic recovery next year but is subject to downside risks, which include the possibility of a third wave of COVID-19, adverse weather events, rising international oil and food prices and tightening of global financial conditions.

According to the statement, Fiji's inflation over the next 12 months is expected to edge up, driven by higher fuel, food and kava prices.

The country's foreign reserves are currently adequate at 3,055.4 million Fijian dollars (about 1,440.1 million U.S. dollars), sufficient to cover 10.6 months of retained imports, according to the bank statement.

The RBF forecasted in September that Fiji's economy would contract further by 4.1 percent this year.

From next year, the economic recovery is expected on the assumption that the current outbreak is controlled, herd immunity is achieved through vaccination, and borders re-open towards the latter part of 2022. Hence, growth is expected to rebound to 6.2 percent in 2022 and accelerate to 8.0 percent in 2023, said the bank.

Fiji has in recent weeks re-opened its international borders for fully vaccinated travellers, who would be required to undertake a three-day quarantine in a Fiji Managed Quarantine (FMQ) facility and would be subject to RT-PCR tests 72 hours pre-departure and in-country.

Fiji reported its first confirmed COVID-19 case on March 19 last year with more than 52,000 cases in total.

According to the country's health authorities, Fiji expects the third wave of COVID-19 because of excessive gatherings that are going to happen over Christmas and New Year.

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