Economy of Vanuatu

Template:Short description Template:Infobox economy Vanuatu's economy is primarily agricultural; 80% of the population is engaged in agricultural activities that range from subsistence farming to smallholder farming of coconuts and other cash crops.<ref>The Case for a Legislative Budget Office in Vanuatu. Social Science Research Network (SSRN). Accessed 18 July 2017.</ref>

Copra is by far the most important cash crop (making up more than 35% of Vanuatu's exports), followed by timber, beef, and cocoa. Kava root extract exports also have become important.

Economic sectors

Financial sector

In addition, the Vanuatu government has maintained the country's pre-independence status as a tax haven and international financial center. About 2,000 registered institutions offer a wide range of offshore banking, investment, legal, accounting, and insurance and trust company services. On the Tax Justice Network's 2011 Financial Secrecy Index, Vanuatu received a "secrecy score" of 88/100, though its marginal market share placed it near the bottom of the weighted list.<ref>Template:Cite web</ref> Vanuatu was one of three Pacific island nations (along with Nauru and Palau) which four major international banks placed a U.S. dollar transaction ban on in December 1999.<ref>Template:Cite web</ref> Vanuatu sells citizenship for about $150,000, and its passports allow visa-free travel throughout Europe. With demand from the Chinese market booming, passport sales may now account for more than 30% of the country's revenue.<ref>How selling citizenship is now big business. Sarah Treanor and Vivienne Nunis, business reporters, BBC News, Vanuatu. 10 October 2019. https://www.bbc.co.uk/news/business-49958628</ref> Vanuatu maintains an international shipping register in New York City.Template:Cn

Fishing industry

There is substantial fishing activity, although this industry does not bring in much foreign exchange. Vanuatu claims an exclusive economic zone of Template:Convert and possesses marine resources.Template:Cn Some ni-Vanuatu are involved in fishing, along with foreign fleets.<ref>Template:Cite magazine</ref>

Mining industry

In contrast, mining activity is unsubstantial.Template:Cn

Agricultural sector

Exports include copra, kava, beef, cocoa and timber, and imports include machinery and equipment, foodstuffs and fuels.Template:Cn Copra, cocoa, kava and beef account for more than 60% of Vanuatu's total exports by value and agriculture accounts for 20% of GDP.Template:Cn

Vanuatu produced in 2018:

• 374 thousand tons of coconut;
• 53 thousand tons of root and tubers;
• 16 thousand tons of banana;
• 13 thousand tons of vegetable;

In addition to smaller productions of other agricultural products, like peanut (2.6 thousand tons) and cocoa (1.8 thousand tons).<ref> Vanuatu production in 2018, by FAO </ref>

Tourism sector

Tourism is Vanuatu's fastest-growing sector, having comprised 40% of GDP in 2000.<ref>Template:Cite web</ref> Industry's portion of GDP declined from 15% to 10% between 1990 and 2008. Government consumption accounted for about 27% of GDP.<ref>Template:Cite web</ref>

Vanuatu has commodities, mostly agricultural, produced for export. In 2000, imports exceeded exports by a ratio of nearly 4 to 1. This was offset by high services income from tourism, which kept the current account balance fairly even. After a downturn in 2001 and 2002 due to a decrease in tourism funding,Template:Clarify the economy was expected to grow by 3.9%, increasing to 4.3% in 2007.Template:Citation needed

Exports

Luganville, the second largest city, is a hub for exports with 64.3% of domestic exports leaving it compared to 35.7% for the capital of Port Vila, whereas imports show the opposite trend with 86.9% entering through the capital and 13.1% through Luganville.<ref>Trade deficit widens, economy looks good - Vanuatudaily.comTemplate:Dead link</ref>

Reform

In 1997 the government, with the aid of the Asian Development Bank, committed itself to a 3-year comprehensive reform program. During the first year of the program the government has adopted a value-added tax, consolidated and reformed government-owned banks, and started a 10% downsizing in the public service.Template:Cn The program was derailed when Barak Sope became prime minister. Under Prime Minister Edward Natapei, reform programs were reintroduced.Template:Cn

Traditional economy

The government declared 2007 to be "the Year of the Traditional Economy" (Template:Langx), encouraging the trade of sea shells and pig tusks and discouraging cash transfers. By the end of the year, they extended the experiment in to 2008.<ref>Vanuatu spurns cash for sea shells and pigs- The Telegraph, 2007-12-25</ref> The establishment of the Tangbunia Bank, to deal in customary wealth, was linked to this initiative.<ref>"Paying in pig tusks in Vanuatu", Andrew Harding, BBC, July 4, 2007</ref>

Economic statistics

Vanuatu scored 32.06 (versus a worldwide score of 42.94, lower scores translating to higher risk) on the June 2013 Euromoney Country Risk rankings.<ref>Template:Cite web</ref>

All "$" units are US Dollar.

GDP: purchasing power parity - $1.237 billion (2012 est.)

GDP - real growth rate: 2.6% (2012 estimate)

GDP - per capita: purchasing power parity - $Template:Val (2012 est.)

GDP - composition by sector:
agriculture: 20.6%
industry: 11.7%
services: 67.6% (2012 est.)

Population below poverty line: NA%

Household income or consumption by percentage share:
lowest 10%: NA%
highest 10%: NA%

Inflation rate (consumer prices): 2.8% (2012 est.)

Labor force: Template:Val (2007)

Labor force - by occupation: agriculture 58%, industry 10%, services 32% (2010 est.)

Unemployment rate: 1.5% (2010)

Budget:
revenues: $188.2 million
expenditures: $207.4 million, including capital expenditures of $700 000 (2012 est.)

Industries: food and fish freezing, wood processing, meat canning

Industrial production growth rate: 12% (2011 est.)

Electricity - production: 52 GWh (2008)

Electricity - production by source:
fossil fuel: 90%
hydro: 0%
nuclear: 0%
other: 10% (2012)

Electricity - consumption: 40.22 GWh (2008)

Electricity - exports: 220 kWh (2008)

Electricity - imports: 0 kWh (2008)

Agriculture - products: copra, coconuts, cocoa, coffee, kava, taro, yams, fruits, vegetables, fish, beef

Exports: $280 million (f.o.b., 2012 est.)

Exports - commodities: copra, beef, cocoa, timber, kava, coffee

Exports - partners: Thailand 57.3%, Japan 21.8% (2011)

Imports: $242 million (f.o.b., 2012)

Imports - commodities: machinery and equipment, foodstuffs, fuels

Imports - partners: China 26.7%, Singapore 21.2%, Australia 13.6%, New Zealand 7.2%, Fiji 6.7%, Japan 5.4% (2011)

Debt - external: $307.7 million (2011)

Economic aid - recipient: $27.5 million (2002)

Currency: 1 vatu (VT), no subdivisions

Exchange rates: vatu (VT) per US$1 – 94.03 (2012), 96.91 (2010), 111.79 (2004), 122.19 (2003), 139.2 (2002), 145.31 (2001), 129.76 (December 1999), 129.08 (1999), 127.52 (1998), 115.87 (1997), 111.72 (1996), 112.11 (1995)

Fiscal year: calendar year

See also

• Fishing in Vanuatu