Despite the positive local outlook, the Reserve Bank of Fiji says there are still downside risks.
Macroeconomic Committee chairperson Ariff Ali said the global economic outlook remained fragile because it suffered from weak demand, slowdown in China, tight labour markets, rising commodity prices and elevated inflation.
He said domestically, ongoing capacity constraints in the tourism industry, the loss of skilled labour because of high emigration, increasing cost of doing business and the constant threat from natural disasters and climate change could easily disrupt the growth projections going forward.
“Over the medium to long term, higher-than-trend growth is required to compensate for the lost economic outputs in 2020-21 and to rebuild fiscal buffers for future economic shocks,” Mr Ali said.
“Fast-tracking structural reforms related to ease of doing business, improving capacity constraints in the tourism industry, addressing the push factors behind high emigration and raising productivity are key policy priorities for unlocking further growth potential.”
Mr Ali said the next review of the GDP forecasts will be before the 2024-25 national budget.
