Vanuatu
Vanuatu ( or ; ), officially the Republic of Vanuatu (french: link=no, République de Vanuatu; bi, Ripablik blong Vanuatu), is an island country located in the South Pacific Ocean. The archipelago, which is of volcanic origin, is east of no ...
's
economy
An economy is an area of the production, distribution and trade, as well as consumption of goods and services. In general, it is defined as a social domain that emphasize the practices, discourses, and material expressions associated with the ...
is primarily
agricultural; 80% of the population is engaged in agricultural activities that range from
subsistence farming
Subsistence agriculture occurs when farmers grow food crops to meet the needs of themselves and their families on smallholdings. Subsistence agriculturalists target farm output for survival and for mostly local requirements, with little or no su ...
to
smallholder
A smallholding or smallholder is a small farm operating under a small-scale agriculture model. Definitions vary widely for what constitutes a smallholder or small-scale farm, including factors such as size, food production technique or technology ...
farming of
coconuts and other
cash crops.
Copra
Copra (from ) is the dried, white flesh of the coconut from which coconut oil is extracted. Traditionally, the coconuts are sun-dried, especially for export, before the oil, also known as copra oil, is pressed out. The oil extracted from co ...
is by far the most important cash crop (making up more than 35% of Vanuatu's exports), followed by
timber
Lumber is wood that has been processed into dimensional lumber, including beams and planks or boards, a stage in the process of wood production. Lumber is mainly used for construction framing, as well as finishing (floors, wall panels, w ...
,
beef
Beef is the culinary name for meat from cattle (''Bos taurus'').
In prehistoric times, humankind hunted aurochs and later domesticated them. Since that time, numerous breeds of cattle have been bred specifically for the quality or quantit ...
, and
cocoa
Cocoa may refer to:
Chocolate
* Chocolate
* ''Theobroma cacao'', the cocoa tree
* Cocoa bean, seed of ''Theobroma cacao''
* Chocolate liquor, or cocoa liquor, pure, liquid chocolate extracted from the cocoa bean, including both cocoa butter and ...
.
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 bank
An offshore bank is a bank regulated under international banking license (often called offshore license), which usually prohibits the bank from establishing any business activities in the jurisdiction of establishment. Due to less regulation and ...
ing, investment, legal, accounting, and insurance and
trust company
A trust company is a corporation that acts as a fiduciary, trustee or agent of trusts and agencies. A professional trust company may be independently owned or owned by, for example, a bank or a law firm, and which specializes in being a trust ...
services. On the
Tax Justice Network
The Tax Justice Network (or TJN) is an advocacy group consisting of a coalition of researchers and activists with a shared concern about tax avoidance, tax competition, and tax havens.
Empirical results
The TJN has reported on the OECD Base ...
'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. 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.
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.
Vanuatu maintains an international shipping register in
New York City
New York, often called New York City or NYC, is the most populous city in the United States. With a 2020 population of 8,804,190 distributed over , New York City is also the most densely populated major city in the Un ...
.
Fishing industry
There is substantial fishing activity, although this industry does not bring in much foreign exchange.
Vanuatu claims an exclusive economic zone of and possesses
marine resources. Some ni-Vanuatu are involved in
fishing
Fishing is the activity of trying to catch fish. Fish are often caught as wildlife from the natural environment, but may also be caught from stocked bodies of water such as ponds, canals, park wetlands and reservoirs. Fishing techniques inclu ...
, along with foreign fleets.
Mining industry
In contrast, mining activity is unsubstantial.
Agricultural sector
Exports include
copra
Copra (from ) is the dried, white flesh of the coconut from which coconut oil is extracted. Traditionally, the coconuts are sun-dried, especially for export, before the oil, also known as copra oil, is pressed out. The oil extracted from co ...
,
kava, beef, cocoa and timber, and imports include machinery and equipment, foodstuffs and fuels.
Copra
Copra (from ) is the dried, white flesh of the coconut from which coconut oil is extracted. Traditionally, the coconuts are sun-dried, especially for export, before the oil, also known as copra oil, is pressed out. The oil extracted from co ...
,
cocoa
Cocoa may refer to:
Chocolate
* Chocolate
* ''Theobroma cacao'', the cocoa tree
* Cocoa bean, seed of ''Theobroma cacao''
* Chocolate liquor, or cocoa liquor, pure, liquid chocolate extracted from the cocoa bean, including both cocoa butter and ...
,
kava and
beef
Beef is the culinary name for meat from cattle (''Bos taurus'').
In prehistoric times, humankind hunted aurochs and later domesticated them. Since that time, numerous breeds of cattle have been bred specifically for the quality or quantit ...
account for more than 60% of Vanuatu's total exports by value and agriculture accounts for 20% of
GDP
Gross domestic product (GDP) is a monetary measure of the market value of all the final goods and services produced and sold (not resold) in a specific time period by countries. Due to its complex and subjective nature this measure is ofte ...
.
Vanuatu produced in 2018:
* 374 thousand tons of
coconut;
* 53 thousand tons of
root
In vascular plants, the roots are the organs of a plant that are modified to provide anchorage for the plant and take in water and nutrients into the plant body, which allows plants to grow taller and faster. They are most often below the su ...
and
tubers
Tubers are a type of enlarged structure used as storage organs for nutrients in some plants. They are used for the plant's perennation (survival of the winter or dry months), to provide energy and nutrients for regrowth during the next growing s ...
;
* 16 thousand tons of
banana;
* 13 thousand tons of
vegetable
Vegetables are parts of plants that are consumed by humans or other animals as food. The original meaning is still commonly used and is applied to plants collectively to refer to all edible plant matter, including the flowers, fruits, stems, ...
;
In addition to smaller productions of other agricultural products, like
peanut
The peanut (''Arachis hypogaea''), also known as the groundnut, goober (US), pindar (US) or monkey nut (UK), is a legume crop grown mainly for its edible seeds. It is widely grown in the tropics and subtropics, important to both small and ...
(2.6 thousand tons) and
cocoa
Cocoa may refer to:
Chocolate
* Chocolate
* ''Theobroma cacao'', the cocoa tree
* Cocoa bean, seed of ''Theobroma cacao''
* Chocolate liquor, or cocoa liquor, pure, liquid chocolate extracted from the cocoa bean, including both cocoa butter and ...
(1.8 thousand tons).
Tourism sector
Tourism
Tourism is travel for pleasure or business; also the theory and practice of touring, the business of attracting, accommodating, and entertaining tourists, and the business of operating tours. The World Tourism Organization defines tourism mor ...
is Vanuatu's fastest-growing sector, having comprised 40% of GDP in 2000. Industry's portion of GDP declined from 15% to 10% between 1990 and 2008. Government consumption accounted for about 27% of GDP.
Vanuatu has commodities, mostly agricultural, produced for
export
An export in international trade is a good produced in one country that is sold into another country or a service provided in one country for a national or resident of another country. The seller of such goods or the service provider is an ...
. 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, the economy was expected to grow by 3.9%, increasing to 4.3% in 2007.
Exports
Luganville
Luganville is the second largest city in Vanuatu after the capital Port Vila; it is located on the island of Espiritu Santo and has a population of 18,062 as of the 2020 census. Those on Vanuatu's northern islands who regard Luganville as their b ...
, 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
Port Vila (french: Port-Vila), or simply Vila (; french: Vila; bi, Vila ), is the capital and largest city of Vanuatu. It is located on the island of Efate.
Its population in the last census (2009) was 44,040, an increase of 35% on the pr ...
, whereas imports show the opposite trend with 86.9% entering through the capital and 13.1% through Luganville.
Reform
In 1997 the government, with the aid of the
Asian Development Bank
The Asian Development Bank (ADB) is a regional development bank established on 19 December 1966, which is headquartered in the Ortigas Center located in the city of Mandaluyong, Metro Manila, Philippines. The bank also maintains 31 field offic ...
, committed itself to a 3-year comprehensive reform program. During the first year of the program the government has adopted a
value-added tax
A value-added tax (VAT), known in some countries as a goods and services tax (GST), is a type of tax that is assessed incrementally. It is levied on the price of a product or service at each stage of production, distribution, or sale to the en ...
, consolidated and reformed government-owned banks, and started a 10% downsizing in the public service. The program was derailed when
Barak Sope
Barak ( or ; he, בָּרָק; Tiberian Hebrew: ''B-R-Q, Bārāq''; ar, البُراق ''al-Burāq'' "lightning") was a ruler of Ancient Israel. As military commander in the biblical Book of Judges, Barak, with Deborah, from the Tribe of Eph ...
became Prime Minister. Under
Prime Minister
A prime minister, premier or chief of cabinet is the head of the cabinet and the leader of the ministers in the executive branch of government, often in a parliamentary or semi-presidential system. Under those systems, a prime minister i ...
Edward Natapei, reform programs were reintroduced.
Traditional economy
The government declared 2007 to be "the Year of the Traditional Economy" ( bi, kastom ekonomi), 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. The establishment of the
Tangbunia Bank
The Tangbunia Bank (widely misreported as ''Tari Bunia'') is a bank run by the Turaga indigenous movement on Pentecost Island in Vanuatu. It is notable for dealing in items of customary wealth such as hand-woven mats, shells or pig tusks rather ...
, to deal in customary wealth, was linked to this initiative.
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.
All "$" units are
US Dollar
The United States dollar ( symbol: $; code: USD; also abbreviated US$ or U.S. Dollar, to distinguish it from other dollar-denominated currencies; referred to as the dollar, U.S. dollar, American dollar, or colloquially buck) is the officia ...
.
GDP:
purchasing power parity - $1.237 billion (2012 est.)
GDP - real growth rate:
2.6% (2012
estimate
Estimation (or estimating) is the process of finding an estimate or approximation, which is a value that is usable for some purpose even if input data may be incomplete, uncertain, or unstable. The value is nonetheless usable because it is de ...
)
GDP - per capita:
purchasing power parity - $ (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:
(2007)
Labor force - by occupation:
agriculture
Agriculture or farming is the practice of cultivating plants and livestock. Agriculture was the key development in the rise of sedentary human civilization, whereby farming of domesticated species created food surpluses that enabled people t ...
58%,
industry
Industry may refer to:
Economics
* Industry (economics), a generally categorized branch of economic activity
* Industry (manufacturing), a specific branch of economic activity, typically in factories with machinery
* The wider industrial sector ...
10%,
services
Service may refer to:
Activities
* Administrative service, a required part of the workload of university faculty
* Civil service, the body of employees of a government
* Community service, volunteer service for the benefit of a community or a p ...
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
Wood processing is an engineering discipline in the wood industry comprising the production of forest products, such as pulp and paper, construction materials, and tall oil. Paper engineering is a subfield of wood processing.
The major wood pro ...
, 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
Copra (from ) is the dried, white flesh of the coconut from which coconut oil is extracted. Traditionally, the coconuts are sun-dried, especially for export, before the oil, also known as copra oil, is pressed out. The oil extracted from co ...
,
coconuts,
cocoa
Cocoa may refer to:
Chocolate
* Chocolate
* ''Theobroma cacao'', the cocoa tree
* Cocoa bean, seed of ''Theobroma cacao''
* Chocolate liquor, or cocoa liquor, pure, liquid chocolate extracted from the cocoa bean, including both cocoa butter and ...
,
coffee
Coffee is a drink prepared from roasted coffee beans. Darkly colored, bitter, and slightly acidic, coffee has a stimulating effect on humans, primarily due to its caffeine content. It is the most popular hot drink in the world.
Seeds of ...
,
kava,
taro
Taro () (''Colocasia esculenta)'' is a root vegetable. It is the most widely cultivated species of several plants in the family Araceae that are used as vegetables for their corms, leaves, and petioles. Taro corms are a food staple in Afri ...
,
yams,
fruit
In botany, a fruit is the seed-bearing structure in flowering plants that is formed from the ovary after flowering.
Fruits are the means by which flowering plants (also known as angiosperms) disseminate their seeds. Edible fruits in particu ...
s,
vegetable
Vegetables are parts of plants that are consumed by humans or other animals as food. The original meaning is still commonly used and is applied to plants collectively to refer to all edible plant matter, including the flowers, fruits, stems, ...
s,
fish
Fish are aquatic, craniate, gill-bearing animals that lack limbs with digits. Included in this definition are the living hagfish, lampreys, and cartilaginous and bony fish as well as various extinct related groups. Approximately 95% of ...
,
beef
Beef is the culinary name for meat from cattle (''Bos taurus'').
In prehistoric times, humankind hunted aurochs and later domesticated them. Since that time, numerous breeds of cattle have been bred specifically for the quality or quantit ...
Exports:
$280 million (f.o.b., 2012 est.)
Exports - commodities:
copra
Copra (from ) is the dried, white flesh of the coconut from which coconut oil is extracted. Traditionally, the coconuts are sun-dried, especially for export, before the oil, also known as copra oil, is pressed out. The oil extracted from co ...
,
beef
Beef is the culinary name for meat from cattle (''Bos taurus'').
In prehistoric times, humankind hunted aurochs and later domesticated them. Since that time, numerous breeds of cattle have been bred specifically for the quality or quantit ...
,
cocoa
Cocoa may refer to:
Chocolate
* Chocolate
* ''Theobroma cacao'', the cocoa tree
* Cocoa bean, seed of ''Theobroma cacao''
* Chocolate liquor, or cocoa liquor, pure, liquid chocolate extracted from the cocoa bean, including both cocoa butter and ...
,
timber
Lumber is wood that has been processed into dimensional lumber, including beams and planks or boards, a stage in the process of wood production. Lumber is mainly used for construction framing, as well as finishing (floors, wall panels, w ...
,
kava,
coffee
Coffee is a drink prepared from roasted coffee beans. Darkly colored, bitter, and slightly acidic, coffee has a stimulating effect on humans, primarily due to its caffeine content. It is the most popular hot drink in the world.
Seeds of ...
Exports - partners:
Thailand
Thailand ( ), historically known as Siam () and officially the Kingdom of Thailand, is a country in Southeast Asia, located at the centre of the Indochinese Peninsula, spanning , with a population of almost 70 million. The country is b ...
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
Singapore (), officially the Republic of Singapore, is a sovereign island country and city-state in maritime Southeast Asia. It lies about one degree of latitude () north of the equator, off the southern tip of the Malay Peninsula, bor ...
21.2%,
Australia 13.6%,
New Zealand
New Zealand ( mi, Aotearoa ) is an island country in the southwestern Pacific Ocean. It consists of two main landmasses—the North Island () and the South Island ()—and over 700 smaller islands. It is the sixth-largest island count ...
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
Fishing is important to the Economy of Vanuatu, national economy of Vanuatu. It is the main source of income for many in the islands and Vanuatu's biggest export. According to 2009 figures, approximately 77% of households in Vanuatu are involved in ...
References
{{DEFAULTSORT:Economy Of Vanuatu