Fiji is one of the most developed of the Pacific Island economies. However, it remains a developing country with a large subsistence agricultural sector; it relies very heavily on its sugar industry, as well as its travel and tourism and fishing industries.
Sugar exporting makes up one-third of the country’s industrial activity, and that, along with a growing tourism industry, are Fiji’s major sources of foreign exchange.
Another very successful industry is the export of the Fiji Still Mineral Water, which, since 2000, is primarily imported into the United States.
Because of the islands’ location, Fiji consists of various rich natural resources, including abundant water bodies, rainforests and excellent mineral resources. Thanks to its mineral resources, gold is another important export industry.
Fiji’s economic freedom score is 62.0, making its economy the 84th freest in the 2018 Index.
Its overall score has decreased by 1.4 points, with a plunging score for fiscal health and declines in the government spending and monetary freedom indicators overwhelming improvements in judicial effectiveness and government integrity.
Fiji is ranked 19th among 43 countries in the Asia–Pacific region, and its overall score is just above the regional and world averages.
Main sectors in Fiji
Agriculture
The agriculture sector plays an integral part in the Fijian economy, given its capacity to contribute effectively towards key policy priorities such as employment, food security, foreign exchange earnings and economic growth.
Fisheries
The fisheries sector contributes around 2.8% to GDP and 9.7% to total export earnings.
Since fish is a key resource, more emphasis is being placed on the Decree to deter illegal, unregulated and unreported fishing.
Tourism
The tourism industry constitutes activity in a large number of sectors that provide diverse products and services to visitors. Its combined direct and indirect contributions to GDP average above 30.0%.
ICT (Information and Communication Technologies)
Fiji is well positioned to attract ICT investments.
The objective for Fiji’s ICT industry is to harness Fiji’s ideal geographic location, competent English-speaking workforce, and world-class IT infrastructure to promote Fiji’s capability and competitiveness and create a dynamic and well connected e-society.
Taxes in Fiji
A 9% Government Value Added Tax (VAT) is applicable to all goods and services in Fiji.
Resident corporations are subject to a Corporate Income Tax (CIT) on their worldwide income, while non-resident corporations may only be taxed on their Fiji-sourced income.
Non-resident shipping companies in respect of outgoing business from carriage of passengers, livestock, mail, merchandise, or goods embarked or loaded in Fiji are subject to a CIT rate of 2%.
Non-resident company that establishes its regional or global headquarters in Fiji are subject to a CIT rate of 17%. Company listed on the South Pacific Stock Exchange (SPSE) are subject to a CIT rate of 10%.
All other companies, including non-resident companies carrying on business in Fiji, are subject to a CIT rate of 20%.
Dividends paid or credited to a non-resident shareholder will be subject to Withholding Tax (WHT) at 9%.
Interest payments to non-residents are subject to WHT at 10%, while royalty payments to non-residents are subject to WHT at 15%.
Investing in Fiji
Fiji offers many opportunities in the traditional economic sectors; but the island’s rapidly emerging sectors, such as manufacturing and information and communications technology (ICT), are also ideal for investment.
Top Reasons Why to Invest in Fiji:
1. Having an excellent strategic position, Fiji is a regional and global hub for the South Pacific region.
2. Its shipping and air travel routes make it a hub for global communications and transportation.
3. Trade and investment incentives, including duty concessions, investment allowances, tax exemption and tax free regions.
4. The government supports local and foreign investments and is focused on bringing reforms that will further improve business conditions. 5. A well-developed infrastructure, including electricity, water supply, international airports and wharfs.
6. Well-developed banking and financial institutions providing a full range of financial services.
7. Fast registration of foreign investment projects.
8. Well educated workforce with a literacy rate of 93.7%.
9. Fiji is signatory to various trade agreements, providing better market access and investment opportunities with other countries.