WESTPAC Fiji has downgraded its 2025 growth outlook for Fiji in light of global trade shocks and uncertainties in major international financial markets set off by United States President Donald Trump’s tariff measures early this month.
In its latest “Westpac Wave” Economic Update released on Monday, Westpac Fiji considerably revised its growth projection downwards, predicting an earlier than expected softening of the tourism sector, Fiji’s major economic driver.
“The downturn in visitor arrivals during the first quarter of 2025 raises concerns about the domestic economic outlook, compounded by global uncertainty and its potential impact on trade and inflation,” it stated
“Our economic outlook for 2025 has shifted to the downside.
“We now expect Fiji’s economy to grow by 2.7 percent in 2025 vs our earlier projection of 3.4 percent.”
Latest provisional numbers from the Fiji Bureau of Statistics had shown that visitor arrivals for February declined by 9.6 percent compared to February last year and significantly dropped by 30.1 percent compared to January 2025.
Visitor arrivals for March was a 7.9 percent decline compared to March 2024 but was a recovery of 29 percent compared to February 2025.
“The tourism arrival numbers are down compared to where they would normally be, and we are particularly concerned about the five-month continuous decline in New Zealand arrivals,” Westpac Fiji stated.
“While we can point to the recession in New Zealand, visitors from Australia also slipped in February and March.
“With the Australian election looming in May, this adds further uncertainty to the outlook for Fiji’s near-term arrival numbers.
“We always expected tourism growth to soften in the near term, but the risk now is that this scenario may unfold as early as this year.”
US reciprocal tariffs on Fiji’s source markets, threat of looming recession and downward revised growth outlook does not help the tourism industry, Westpac Fiji noted, adding that it was monitoring events unfolding on the global stage and their impact on the domestic economy.
“In terms of our broad view, the tourism sector outlook amidst all the uncertainty and looming risks is still expected to hold up, but below our previous expectations.
“A number of scenarios we ran point to decline in the number of visitor arrivals in 2025.
“We are cautiously optimistic on visitor arrivals outlook and assume no growth.”
