Finance Minister Esrom Immanuel has unveiled a package of measures to strengthen Fiji’s tourism industry, including a planned $200 million Government guarantee for Fiji Airways, a temporary tourism services tax and billions of dollars in new tourism infrastructure investment.
Presenting the 2026-2027 National Budget in Parliament, Mr Immanuel described tourism as the cornerstone of Fiji’s economy, contributing about 40 per cent of national economic activity.
“Mr Speaker Sir, to raise our growth, we have to protect our tourism industry which contributes around 40 percent towards our economy.”
He said Government would focus on maintaining the industry’s competitiveness by expanding tourism infrastructure, increasing airport capacity, encouraging new hotel developments, diversifying tourism products and ensuring Fiji remained a safe destination for visitors.
Mr Immanuel said supporting Fiji Airways was central to that strategy, noting the national carrier played a vital role in bringing tourists to Fiji and positioning the country as the aviation hub of the South Pacific.
He said the airline had recently come under financial pressure because of soaring aviation fuel prices while still recovering from heavy losses incurred during the COVID-19 pandemic.
To assist the airline, Mr Immanuel announced that Government would soon seek parliamentary approval for a $200 million Government guarantee.
The Budget also extends Fiji Airways’ tax loss carry-forward period from eight years to 15 years and waives approximately $10 million in government fees and charges over the next 12 months.
Mr Immanuel said Government was also working with Fiji Airports, Air Terminal Services, the Civil Aviation Authority of Fiji, the Fiji National Provident Fund and the Fiji Development Bank to ease financial pressures on the airline.
In addition, he announced that the tourism industry had agreed to support a temporary 5 per cent Tourism Services Tax on hotels and tour and cruise operators with annual turnover exceeding $2 million.
The tax will apply for 12 months from September 1, 2026, with all revenue ring-fenced exclusively for Fiji Airways.
Mr Immanuel said the industry had broadly agreed that most of the cost would be absorbed by operators rather than passed on to visitors.
The measure is expected to generate around $70 million for the airline.
Looking beyond airline support, the Finance Minister outlined a substantial pipeline of tourism investment.
He said hotel developments worth more than $3 billion were expected to add approximately 5,500 new hotel rooms, including 1,400 rooms currently under construction, 2,500 in pre-development and 1,600 at the conceptual stage.
Mr Immanuel also announced that Fiji Airports would invest more than $700 million over the next five years to modernise airport infrastructure, upgrade regional airports, expand digital technologies, strengthen aviation safety systems and increase renewable energy capacity.
He highlighted progress on the $440 million (US$200 million) Vanua Levu Tourism Development Programme, known as the Na Vualiku Project, describing it as one of the largest tourism investments ever undertaken in the Northern Division.
Supported by the World Bank, the first phase of the programme will fund improvements to roads, airports, water supply, sanitation, energy and waste management infrastructure across Vanua Levu and Taveuni.
The 2026-2027 Budget allocates $20 million for implementation of the programme during the coming financial year.
