ANZ senior international economists Dr Kishti Sen and Tom Kenny believe the numbers of visitor arrivals have likely peaked for Fiji in terms of tourism’s contribution to GDP growth.
In their latest Pacific Economic Outlook report released to clients this week, the economists said visitor numbers had stabilised, albeit at a higher level on a moving annual total basis.
“We expect Fiji may find it difficult to attract more visitors out of its key markets of Australia and New Zealand,” Mr Sen and Mr Kenny said.
“Its market share of Australian tourists has returned to its pre-pandemic level of about 4 percent.
“Australians are also now saving more of their income, perhaps due to uncertainty around global growth, as the world reacts to US trade policies.”
The economists said interest rates also remained on the tight side of neutral, which was making households take a more cautious approach to discretionary spending.
Fiji’s turnaround in economic performance from its pandemic-induced recession was attributed to the country’s ability to quickly welcome tourists in large numbers after reopening its international border.
Visitor arrivals in 2023 exceeded record arrivals of 2019 and last year, inbound nearly reached one million visitors, which the economists said was almost unthinkable at the height of the pandemic.
They said the turn of international tourism returned people to their jobs and created new employment.
That, in turn returned household financial consumption to its pre-pandemic levels and helped restore equilibrium in the economy.
“We think Fiji will do well if it is able to reach last year’s level of inbound demand,” Mr Sen and Mr Kenny said.
“That will keep activity in the tourism economy at a higher plateau but limit its chances of adding to GDP growth.”
The Fiji Bureau of Statistic had reported 70,794 visitor arrivals to Fiji in January this year, up 0.7 percent from 70,324 arrivals recorded in January last year.
