Investment in Fiji is showing tentative signs of recovery, but progress remains sluggish due to rising costs and persistent global uncertainties, the Reserve Bank of Fiji (RBF) revealed in its August 2025 Economic Review.
According to the RBF, partial indicators suggest that the recovery in investment is slow-moving.
While there has been a modest 1.4% increase in new investment loans in the year to July, driven mainly by lending to the real estate sector and households for investment homes, other key indicators paint a mixed picture.
Cement sales, a key input in construction, plunged 14.4% in the first half of the year, largely due to a temporary closure of Pacific Cement Limited’s mill between March and June. The disruption likely stalled various construction projects.
Building activity data for the first quarter also reflected inconsistencies.
While the number of new building permits issued increased by 11.3%, the total value of those permits fell by 21.5%.
This drop was attributed to a decline in the value of private dwellings, which offset gains in commercial building permits.
Adding to the investment headwinds is the continued rise in construction input costs.
The building material prices index rose by 4.0% in the first half of the year, exacerbating cost pressures across the industry.
However, the RBF noted that the recent reduction in VAT could help bolster investor confidence and partially offset rising costs.
Still, the central bank warned that significant downside risks remain.
Chief among them are the ongoing Trump-era tariffs and intensifying global geopolitical tensions, which could weaken demand from Fiji’s major trading partners.
This, in turn, may affect exports, remittances, and visitor arrivals.