Kiribati: 2026 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Kiribati

The 2026 Article IV Consultation discusses that Kiribati’s recent gross domestic product (GDP) growth has exceeded that of other Pacific Island countries and poverty has declined significantly. Growth is projected to moderate to about 3.1 percent in 2026 but the outlook remains highly uncertain amid external shocks and persistent structural challenges. Real GDP growth is expected to moderate to around 3.1 percent in 2026 and to gradually decline to around 2 percent over the medium term. Fiscal policy can help mitigate the impact of the energy price shock on vulnerable households with temporary, targeted transfers, while allowing domestic fuel prices to gradually adjust. A sustained growth-friendly fiscal consolidation over the medium term is needed for long-term debt sustainability. Strengthening institutional capacity, by establishing a debt management framework, improving public financial management, revenue administration, and the quality of national statistics, is essential for continued growth and private sector development.