Inbound Aust Tourist Demand Stays Strong
Narube: Bigger concern is how it would impact cost of living for ordinary Fijians as cost of imports from Australia would also go up. With Australia being Fiji’s biggest source market, there have been concerns about the impact on rate hikes in domestic to
Despite fears that recent interest rate increases by the Reserve Bank of Australia would badly hit Fiji’s tourism sector, Australia-based ANZ Pacific economist, Kishti Sen, has predicted otherwise.
“In Australia, strong wages growth and record low unemployment rates are boosting average earnings and income,” Mr Sen said.
“Discretionary household spending was up 9.8 per cent in Q4 2022, compared with pre-pandemic versus 4.0 per cent for essential spending.
“Overall, household spending growth may slow this year as higher interest rates and inflation eat into household budgets.
“Savings buffers and still strong pent-up demand for international travel should see inbound demand from Australia remaining strong throughout 2023 particularly for the upcoming high season.”
Last week, the Reserve Bank of Australia (RBA) announced increases in cash rate targets and Exchange Settlement balances. With Australia being Fiji’s biggest source market, there have been concerns about the impact on rate hikes in domestic tourism. Former Reserve Bank of Fiji Governor Savenaca Narube said while Australia’s rate hike could reduce Fiji’s tourist arrivals from Australia, the bigger concern was how it would impact cost of living for ordinary Fijians as cost of imports from Australia would also go up.
“With the cost of living everywhere being the way it is, things will probably go up further before it stabilises,” Mr Narube said.
“We are the victims of what is happening around the world in terms of cost of living.
“We will see prices continue to go higher.
“That’s where the Government should put its thinking cap on and try to moderate the cost of living. “That, to me, is number one priority.”