Economy of Fiji
KEY FACTS 2015
GNI: US$4.3 billion
GNI p.c.: US$4,830
GDP growth: 5.6% p.a. 2011–15
Inflation: 1.4% p.a. 2011–15
The Fijian economy is largely agricultural, with the main cash crop and export being sugar cane. Tourism is the largest foreign-exchange earner and clothing exports grew rapidly from the late 1980s. Other significant activities are gold mining, fishing and timber production.
More than 80 per cent of land is owned by ethnic Fijians, mainly by the local clans, or mataqali, and ownership by outsiders was prohibited from the late 19th century. Indo-Fijians were able to farm sugar cane under land lease arrangements. However, from the late 1990s, as leases came up for renewal, many landlords would only offer short leases at higher rents and many Indo-Fijian farmers have had to return the farms they have worked for many years to the owners.
Both sugar and tourism are vulnerable to the climate – hurricanes are relatively frequent and droughts can also cause problems, for example severe drought in 1997–98 was followed by cyclones and extensive flooding, and the islands were again devastated by Cyclone Ami in January 2003. Moreover, tourists can be deterred by political instability.
Thus, economic growth has been uneven, with strong growth in years when the harvest is good, such as 1999, and negative growth in years such as 2000 when the government was overthrown, some hotels were closed and tourist numbers fell sharply.
After 2000, however, there were several years of good growth, before a decline in clothing exports (due to the ending of US market quotas at the end of 2004) caused slower growth from 2005. Then, following the coup of December 2006, which caused tourist numbers to fall by 70 per cent, and the subsequent global recession, the economy stagnated in 2007–09, recovering in 2010, with steady growth generally of two to four per cent p.a. during 2010–15.