Fiji faces increasing economic risks from rising global food and fuel prices, with potential spillover effects on tourism and overall growth, according to the Reserve Bank of Fiji’s April Economic Review.
The central bank said ongoing global tensions, particularly in the Middle East, continue to drive volatility in oil prices, placing pressure on import-dependent economies like Fiji.
“As an import dependent country, Fiji faces elevated risks through higher food and fuel prices, which also impact our tourism industry,” the Review noted.
The RBF warned that these pressures could weigh on household spending, increase business costs and affect visitor arrivals, as higher fuel prices push up airfares and reduce travel demand.
The report highlighted that while inflation eased earlier in the year, conditions are expected to tighten moving forward.
“The increase in domestic fuel prices in April, together with the impact of Tropical Cyclone Vaianu, is expected to feed through to domestic prices, exerting upward pressure on inflation from April and in the months ahead,” the Review stated.
Global uncertainties remain a major concern, with the conflict in the Middle East identified as a key risk to both global and domestic economic stability.
“The ongoing hostilities have driven sharp increases in oil prices, with spillover effects evident across chemicals, technology-related equipment, and global food markets,” the RBF said.
The central bank noted that the duration and severity of the conflict will determine the scale of its impact on Fiji’s economy.
“With global fuel supply risks remaining volatile and prices elevated, the inflation outlook continues to be tilted to the upside,” the Review added.
Despite a relatively stable start to the year, the RBF cautioned that Fiji’s growth outlook for 2026 is now facing downward pressure.
“As such, the current growth outlook of 3.0 percent for the Fiji economy for 2026 is downward biased.”
The Review underscores the vulnerability of Fiji’s economy to external shocks, particularly in energy and food markets, as authorities continue to monitor global developments and their local impact.
