SUPPORTIVE BUSINESS ENVIRONMENT


The Vanuatu Government is convinced that the best option of foreign capital inflow that guarantees fast and sustainable growth development results is Foreign Direct Investment. This is why (i) fostering an open, transparent and conducive national policy environment for investment and (ii) promoting coherence in national and international investment policy making remains a key objective for the Vanuatu Government.

A private sector-led growth principle has been and remains the government's focus since the comprehensive reform program it undertook more than a decade ago. The government recognizes the numerous benefits foreign direct investments will offer that will directly contribute to improving the living standards of its citizens.

The recognition and trust the government has on private enterprises as the engine for economic diversification and sustainable economic growth underpins most of the current government policy initiatives. This is reflected through ongoing policy reforms and developments focusing on sectors where maximum benefits are guaranteed.

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Policy reforms, review and developments for greater policy coherence

Vanuatu has made excellent progress to ensure a welcoming and conducive business environment in the country. This effort has seen a number of policy frameworks developed and well established, thus providing foreign affiliates greater assurance and certainty in choosing Vanuatu as their investment destination.

  • At the national level, The National Trade Policy Framework, National Industry Policy and The Overarching Productive Sector Policy have contributed to provide confidence to existing and potential investors.
  • Internationally, Vanuatu has been well represented and recognized in the area of international trade and investment by key players in international market. Vanuatu became a member of the World Trade Organization (WTO) in 2012. In addition it has progressed a number of regional and international trade agreements such as the PacerPlus and the MSG Agreement. Positive results are guaranteed as a result of this commitment to these trade agreements - that being a member of such international agreements - this will see increase in the number of foreign investment.
  • The review and update of Vanuatu's National Investment Policy will ensure coherence in existing and future sector policies - a sure remedy for a favorable investment environment.

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A focussed development agenda

Improved and effective Infrastructure framework matters so much to the country's growth right now. It is the sector that currently drives national focus and commitment with a lot already happening and still more to come.

  • International and Domestic Airports - Vanuatu's International Airport (Bauer field) has recently been upgraded to cater for larger international flights. Plans are underway for further upgrade to accommodate long haul flights - a long term strategy to support the the Tourism Industry's objective to diversify its tourism market. Australia remains Vanuatu's tourism main market.
  • Road networks - Roads on the islands of Malekula and Tanna have been upgraded to standard tar-sealed roads. Areas on these two islands with high potential in tourism and trade will see increased rate in economic activity.

    Construction of road networks has been made possible by the China-based International Company - CCEC (

  • International Wharves - Popular Port Vila Wharf is currently receiving huge upgrade and once completed will see increased number of international vessels including.
  • Energy Supply - Access to energy increased significantly over the recent past. The introduction and use of solar powered technology is increasingly making an impact on all households and businesses through out the country. UNELCO - is the main power distributor with 3 concessional areas at the moment.

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National Educational Institutions

Ensuring a workforce with the right and quality skills is a key determinant for foreign inward capital flows. The Government's commitment to strengthening the education sector have seen the introduction and establishment of key institutions critical to improve Vanuatu's labour skills.

The Australian and Pacific Technical College (APTC) to provide specialized training to the people of Vanuatu. For example the Hospitality Program was introduced to address the demand for quality services in the tourism industry. To date this program alone claims the highest number of enrollments each year compared to other programs.

The APTC was designed as a centre of training excellence, helping country citizens to gain Australian-standard skills and qualifications for a wide range of vocational careers throughout the Pacific – careers where skilled employees are in high demand. The Australia-Pacific Technical College (APTC) is an Australian Government initiative announced at the Pacific Islands Forum in October 2006 and welcomed by Pacific Island leaders. The APTC is funded by the Australian Government and managed through the Department of Foreign Affairs and Trade - Australia Aid.

The Technical and Vocational Education and Training (TVET) Strengthening Program is an Australian Government funded Program which aims to support economic development through targeted skill development services.The Program encourages a more responsive and better quality training system that is able to meet the skill demands of the productive sectors in provincial communities.

TVET Centres have been established in Sanma, Malampa, Torba and Tafea provinces which coordinate a range of demand-driven training and business development support services. The TVET Centres have now been formally integrated within the structure of the Ministry of Education and Training.

With around 70% of the Vanuatu population aged under 25, enabling access to skill development services to increase employment opportunities and educational pathways is a priority area for the TVET Centres.

The Vanuatu Agriculture College was created in 2005 by an act of Parliament (The Vanuatu Agriculture College Act, NO. 51 of 2005). Originally just teaching livestock, however over the years new courses such as agri-business, horticulture, aquaculture, forestry, communications and IT have been added. Vanuatu Agriculture College among other institutions will continue to implement some of the processes of educating business oriented farmers who can transform subsistence agriculture into commercial production. Whilst maintaining crucial features of Vanuatu’s traditional mixed cropping practices. These methods can be then improvised through research and integrated into small commercial farming enterprises.

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Reforms in Business Regulatory Frameworks

Vanuatu has undertaken a number of critical reforms as part of its ongoing competitive efforts. For example in 2016, the following changes have been made:

  • Starting a Business: Vanuatu made starting a business easier by removing registration requirements and digitizing the company register. This is building on from the stream lining of business approval processes undertaken jointly by the International Finance Corporation (IFC) in 2009-2012.
  • Getting Credit: Vanuatu improved access to credit by passing a new law that allows secured creditors to realize their assets without being subject to priorities of other creditors.
  • Protecting Minority Investors: Vanuatu strengthened minority investor protections by increasing shareholder rights and role in major corporate decisions and clarifying ownership and control structures.
  • Resolving Insolvency: Vanuatu made resolving insolvency easier by strengthening and modernizing its legal framework in relation to liquidation and receivership proceedings.

Significant developments currently in progress include:

  • Vanuatu National Investment Bill - once approved, this will see a lot of improvement in the country's business environment
  • National Investment Policy - Progress has been made to review existing policy