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Fiji has been marred in political instability as the country’s long running dispute between the native indigenous Fijians and those Fijians of ethnic Indian (Indo) heritage continue even today to some degree.  Fortunately, Fiji has successfully returned and held democratic elections in September 2014. A return to democratic government, a first since year 2006. The ethnic division has resulted in elevated emigration of Indo-Fijians over the last 20 years.

But what about that Fijian dollar during this time? With all this political drama, chaos and divisions, the Fijian dollar surprisingly has traded in a stable exchange rate valuation with the exception of the Asian Financial crisis in 1997-98 when all Asian currencies experienced extreme turbulence.

the country follows a constitutional democracy.    Fiji achieved independence in 1970 from the United Kingdom, this south Pacific island nation is fragmented between Fijians of ethnic Indian descent who account for 38.1 percent of Fiji’s 903,000 people and the indigenous native Fijians who represent 54.3 percent. 

ECONOMY: historically, Fiji has recorded a good economic record within many areas including low inflation, low levels of external debt and small fiscal deficits.

Sugar, tourism, agriculture and remittances are the major income sources for the Fijian economy. Fiji by many measures is considered to be a sugar based economy and hence vulnerable to drought.  Sugar and tourism with tourist arrivals upwards of 500,000 visitors per year are the backbone of the Fijian economy.  Currently, a large percentage of the Fijian population survive on subsistencel. Major exports for Fiji include gold, sugar, garments, fish, wood, hard-fixed vegetable fats & oils, agricultural while imports include oil, machinery, etc. 

Economic Statistics
GDP as measured by purchasing power parity is at 4.45 billion USD (2013) with corresponding GDP per capita at 4,900 USD (2013). GDP market at 4.22 billion USD (2012).  GDP growth for 2013 came in at 4.6 percent, 2014 at 3.8 percent and year 2015 estimated at 2.5 percent.  Inflation quotes include year 2013 at 2.9 percent, 2014 at 1.2 percent and year 2015 at 3 percent. Current account is in deficit at about 400 million USD with the trade component in deficit at 1 billion USD. The United States is the largest export market while Singapore for import supplier. Fiscal deficit running at around 2 percent of GDP. Public debt at 56 percent of GDP (2013). 
POSITIVE:  member of British Commonwealth, beautiful scenery - tourism paradise, abundant natural resources   CONCERN:  emigration of skilled workers, cyclones, land ownership rights.

BANKING SYSTEM: stable for the moment. As of year end 2013, foreign exchange reserves including gold at 964 million USD.  The Reserve Bank of Fiji (RBF) has protected the value of the Fijian dollar during the political crisis during 2000 and when required - active management. The current policy rate is at 0.5 percent.

REGIONAL ANALYSIS: Solomon Islands, Australia, Asia
Please read the write up SOLOMON ISLANDS in this currency index for further background information on the region.

KNOWLEDGE: Land Leases - The Backbone of Stability for Fiji
Please contact for an analysis.

ISO Symbol ‘FJD’, Fijian dollar. At time of review on March 20, 2015, the Fijian dollar had an exchange valuation of 2.057 FJD to 1 USD equivalent to 48.61 US cents for 1 FJD and/or 2.21 FJD to 1 EUR (Euroland euro). The Fijian dollar was devalued by 20 percent on January 20, 1998 from the fallout of the Asian Financial crisis at that time as exchange pressure amounted due to a current account deficit hitting 30 percent of GDP. As of 2002, Fiji has in place various exchange controls.

CURRENCY HISTORY:  the FJD came into circulation in year 1969 when it replaced the then trading Fijian pound at an exchange rate of one pound for two FJD dollars. Some historical exchange valuations include year 1987 at 1.243 FJD to the USD, 1990 at 1.480, 1992 at 1.485, 1993 at 1.541, 1994 at 1.46, 1995 at 1.406, November 1996 at 1.371, December 1997 at 1.525, January 1998 at 1.70, February 1998 at 1.905, August 1998 at 2.071, December 1999 at 1.983, November 2000 at 2.267, January 2002 at 2.27, January 2003 at 2.012, September 2003 at 1.865 or equivalent to 53.61 US cents for 1 FJD, January 2004 at 1.684 FJD to 1 USD, January 2005 at 1.662, January 2006 at 1.715, January 2007 at 1.674, January 2008 at 1.544, May 2009 at 2.132, June 2010 at 1.994, July 2011 at 1.740, June 2012 at 1.854, January 2013 at 1.769, January 2014 at 1.885 and January 2015 at 2.003.

CURRENCY FORECAST: the return to democratically elected government has earned Fiji renewed trust and confidence in the world market. This new government is now in a position to petition Fiji to secure international development finance from places like the European Union which should help to boost and propel the Fijian economy going forward. Of some concern over the long term is the continued mass emigration of skilled and educated Fijians of ethnic Indian descent. Hopefully, the new government will provide sound management with continued economic reforms and provide for a favorable destination for foreign direct investment. Our currency opinion for the Fijian dollar is optimistic caution with continued currency stability within a trading band range continuing in that 2 FJD to the USD. Finally, the FJD is currently slightly undervalued to the USD as measured by purchasing power parity.

UPDATED: March 20, 2015

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