Out of the rubble of last year’s 7.3 magnitude earthquake that hit Vanuatu’s capital Port Vila on December 17 and the snap election due next week on January 16, a new leadership is required to reset the country’s developmental trajectory.

Persistent political turmoil has hampered the Pacific nation’s ability to deal with a compounding set of social and economic shocks over recent years, caused by climate-related and other natural disasters.

The earthquake is estimated to have conservatively caused US$244 million (VUV29 billion) in damage, and the Vanuatu government’s ability to pay for disaster response, the election, and resume public service delivery will require strong, committed and stable leadership.

• READ MORE: Pacific 2025: Vanuatu quake, Tongan and Kanaky shakeups, Trump questions set tone for coming year
• Other Vanuatu snap election reports

Prior to the devastating quake and dramatic dissolution of Parliament on November 18, economist Peter Judge from Vanuatu-based Pacific Consulting warned of an evolving economic emergency.

Vanuatu’s US$1 billion economy faced a concerning decline in government revenue from value-added tax, down 25 percent on the previous year.

This was a ripple effect from the decline in economic activity after the collapse of national airline Air Vanuatu last May, as well as the falling revenues from the troubled Citizenship by Investment Programme.

Both were plagued by lack of oversight by parliamentarians.

Struggling economy
In 2024, Vanuatu is expected to record about 1 percent economic growth, as it struggles to climb out of the red and back to pre-pandemic levels.

Conversely, Vanuatu has a much more positive, although somewhat contradictory democratic profile.

According to the Global State of Democracy Initiative, Vanuatu is one of the more democratic states in the Pacific islands region, and currently ranks as 45th in the world.

But this performance comes with a significant price. Leadership turnover is frequent, with 28 prime ministerial terms in just 44 years of statehood, 20 of those in the last 25 years — the highest frequency of change in the Melanesian region.

The impacts of disrupted leadership and political instability are highly visible. Government decision-making and service delivery is grindingly slow.

In Vanuatu’s Parliament, the legislative process is frequently deferred due to regular motions of no confidence, with several critical bills still awaiting MPs’ attention.

Last October, for example, the Vanuatu government proposed a 2025 budget 10 percent smaller than 2024’s, due to reduced economic activity and declining government revenue.

Sudden dissolution
Parliament was unable to approve this year’s budget due to its sudden dissolution on November 18, only two-and-a-half years into a four-year political term.

This is the second consecutive presidential dissolution of Parliament, the previous one in 2022 also occurring barely two-and-a-half years into its term.

The Bill for the appropriation of the 2025 budget now awaits the formation of the next legislature for approval. In the meantime, earthquake recovery and election management costs accumulate under a caretaker government.

With deepening economic hardship and industries facing slow economic growth across multiple sectors, voters are looking for leadership that can stabilise the compounding cost of living pressures.

The new government will need to urgently tackle overdue, unresolved issues pertaining to reliable inter-island transport and air connectivity, outstanding teacher salaries and greater opportunities for the nation’s restive youth.

The youth unemployment rate is at 10.7 percent and rising.

Democracy with political stability is the holy grail for Vanuatu. But attaining this legendary and supposedly miraculous prize comes with costs attached.

Rules come into force
In response to civic and youth activism in late 2023 calling for political stability and transparency, the last Parliament approved a national referendum to make political affiliation more accountable and end party hopping.The rules come into force in the next parliamentary term for the first time.

The referendum passed successfully on May 29, 2024, but cost US$2.9 million. The 2022 snap election required US$1.4 million and the 2025 poll is expected to require another US$1.6 million.

While revenue from candidature fees of US$250,000 does cover part of these costs, each legislature transition also weighs on the public purse.

The current crop of outgoing 52 parliamentarians were paid out US$1.62 million in gratuities and benefits — around US$31,000 per MP — even though most did not see out their full terms.

Vanuatu’s average annual household income in 2020 was US$9000.

Whatever the outcome of the 2025 snap election, the incoming government will need to refocus attention on stabilising the trajectory of Vanuatu’s economy and development.

The next legislature — the 14th — will need to commit to stability in the interests of Vanuatu’s people and the nation’s development.

Budget, earthquake recovery priorities
The most immediate priorities for a new government should be the passage of the 2025 national budget and the implementation of an earthquake recovery and reconstruction plan.

In the 45 years since throwing off the British and French colonial yoke, citizens have enthusiastically done their duty at elections in the expectation of a national leadership that will take Vanuatu forward.

Now their faith appears to be waning, after the 2022 poll saw voter turnout — a key indicator of the health of a democracy — dropped below 50 percent for the first time since independence.

This election therefore needs to see a return on the considerable investment made in Vanuatu’s democratic processes, both in terms of financial cost to successive governments and donors, and more to the point, a political dividend for voters.

Anna Naupa is a ni-Vanuatu scholar and currently a PhD student at the Australian National University. Republished from BenarNews with permission.

The government of Vanuatu has convened three major tourism and travel stakeholders this week to announce a major shakeup in the sector.

Dubbed Shared Vision 2030, the plan commits Air Vanuatu, the Vanuatu Tourism Office, and Airports Vanuatu Ltd to an ambitious expansion strategy.

The Vanuatu Daily Post reported yesterday that Air Vanuatu intends to build an actual international fleet of up to eight jet aircraft. Airports Vanuatu Ltd has almost completed the essential Bauerfield runway upgrade. It is also lining up support for an ambitious new facility plan that can accommodate and service Air Vanuatu’s fleet.

READ MORE: Vanuatu and New Caledonia hold historic talks on tourism

For its part, the Tourism Office is being asked to transform itself into a more dynamic organisation, in touch with modern travellers and modern tech.

The government is being asked to stump up no less than VT500 million (NZ$6.6 million) in new money every year for the next five years to back this play.

The plan unveiled on Monday raises countless questions.

Where will Air Vanuatu find the pilots? How will it finance the planes? A new Airbus A320 lists for US$101 million, and a Boeing 737-800 costs about a million dollars more.

Leasing isn’t cheap
Leasing even one isn’t cheap. How will Air Vanuatu afford 6 of them?

A new terminal isn’t just a building. It’s the air traffic control centre, hangars, fuel depot, service bays, fire-fighting and emergency response facilities, food preparation, administration… the list is long and exacting.

All things considered, a price tag of more than  VT10 billion (NZ$130 million) won’t be hard to reach.

The argument in support of the plan is simple. We can either grow now, or run the risk of our economy withering away.

Vanuatu’s economy suffered badly in 2018. Few businesses thrived, and many struggled. VAT revenues are one of the most reliable measures of overall commercial activity. They don’t look good.

Although monthly revenues have surged a few times over the same period in 2017, 2018 revenues overall were only about 10.2 percent higher than last year.

That’s a problem, because revenues should have risen at least 15 percent overall, given the 20 percent rise in the tax rate (2.5 is 20 percent of 12.5, so the rate rise is 2.5 percent, but revenues should increase by 20 percent). The trendline is pointing downward, when it should be sharply upward.

Tourism slump
Much of the commercial slowdown comes from slumping tourism revenues among traditional players. Larger resorts and hotels are struggling, to put it politely. The lucky ones are seeing 50 percent occupancy rates. The unlucky ones are far worse off.

Reduced tourism activity has effects throughout the economy, dragging industry, services and agriculture down with it.

Tourism officials are quick to crow about ‘record’ air arrival numbers. The numbers are real, but they hide a number of problems. First, these numbers have only just managed to rebound from 2014 levels, before the twin catastrophes of cyclone Pam and the Bauerfield runway debacle decimated air arrival numbers.

Second, everyone’s strategic plan expected continuous growth through that period. But we’re barely ahead of where we were in 2014. That puts us almost five years behind schedule.

Lastly, travellers are planning differently. They’re not following the beaten path as much. The advent of social media changed the way people decide where to go, how they book their reservations, and what they do when they’re away.

Referrals matter more than ever. More people ask for input about possible destinations on social media than ever before, and a large number of people decide where to go based on what they hear.

AirBnB is affecting traditional booking patterns enough to make it hurt, especially for larger resorts. Unless arrival numbers rise significantly, it will be impossible to convince new investors to come, and some existing investors could well begin planning an exit.

No middle ground
The plan’s proponents argue that Vanuatu can either rise in popularity, or expect to be ignored by the next generation of travellers.

And based on which path we choose our economy will either grow, or shrink. There’s no middle ground, they say.

But we have to walk before we run. Tourism and travel industry experts tell the Daily Post that the first priority is getting maximum value from existing markets. Expect to see service to Melbourne announced soon, and increased flights to all existing destinations.

One insider told the Daily Post that there is a shortage of aircraft worldwide. Forbes reports that in the USA, for example, “More than three-quarters of the fleet for sale is more than a decade old, [with a] decreasing quantity and quality of less-than-decade-old aircraft.”

Vanuatu will have to acquire ‘new iron’ for its own routes, rather than trying to seduce outside airlines to come here.

One major challenge that has yet to be addressed is the 140 new pilots who will be needed to fly the fleet.

The greatest shortage in the aviation industry right now is pilots. This means more competitive salaries and better working conditions will be needed to convince commercial plots to come, and our own pilots to stay.

Air Vanuatu is holding a press conference today to discuss these and other issues. The Daily Post will be following the story as it develops.

Dan McGarry is media director of the Vanuatu Daily Post group.

• Vanuatu airport crisis

An Air Vanuatu ATR-72 made an emergency landing in Port Vila today. The aircraft, which had 39 passengers and 4 crew aboard, landed in a gentle tail wind.

According to a statement issued by Air Vanuatu Ltd, the aircraft “was involved in a runway excursion. The incident occurred at the end of the runway on landing”.

Neither the pilots nor the passengers on board suffered any injuries. The Civil Aviation Authority Vanuatu is investigating the incident.

The aircraft was inbound to Port Vila from Tanna. It apparently suffered loss of power to one engine as it overflew the island of Erromango, about 20 minutes away from Bauerfield airport in Port Vila.

Multiple sources told the Vanuatu Daily Post that there was smoke in the cabin when the aircraft landed.

Passenger Janis Steele added some details on a Daily Post social media discussion board:

“The cabin was filled with smoke from a fire below and they cut off the starboard engine mid flight. No oxygen masks dropped and visibility in the cabin was only a couple of meters and breathing was difficult.

“The plane went off the runway during the emergency landing and cut through the front half of a [Unity Airlines] plane before we stopped. We then (elderly included) had to jump down from the cabin with about a meter and a half drop.

“So relieved that everyone appears to be physically OK.”

Medical assessment
All passengers were given an emergency medical assessment by first responders. ProMedical staff report no injuries, but confirmed that 13 people reported discomfort due to the smoke, and requested further medical assessment.

The plane landed at 11am and after it had run a significant distance, it veered to the left, into an area in which several small charter aircraft were parked.

One plane belonging to Unity Airlines was a “write off” according to its owner. The nose section of the plane was obliterated, and there is a visible dent in one engine enclosure.

Another aircraft, operated by Air Taxi, suffered significant damage to its tail section. The owner of the aircraft told the Daily Post that she had not been allowed to approach her aircraft to assess damage.

In an update received by the Daily Post shortly after 1pm today, Air Vanuatu offered additional detail:

“Air Vanuatu has advised all domestic and international services are continuing after the re-opening of Bauerfield airport.

“Passengers booked to travel on domestic services are advised to reconfirm their flights with Air Vanuatu by calling 22000.

“Air Vanuatu management is working closely with authorities to investigate the runway excursion of one of their ATR-72 aircraft.

“Chief Executive Officer Derek Nice has spoken with passengers and the operating crew of the flight and praised the crew for their professionalism and skill which contributed to no injuries from the incident.”

No comment
The Daily Post visited the emergency operations centre established by Airports Vanuatu Ltd, which operates Bauerfield airport.

Staff refused to comment, except to confirm that an incident had occurred. They declined to confirm the number of aircraft involved or, curiously, whether airport operations were resuming.

They referred the newspaper to Air Vanuatu for this last piece of information.

Air Vanuatu Ltd later confirmed that the airport had reopened, and they confirmed that one flight, from Port Vila to Nadi, was cancelled. All other flights were going ahead according to schedule, they said.

First responders spoke glowingly of the professionalism of the AVL fire crew. One person with professional firefighting experience told the Daily Post that the ground personnel acted with professionalism and at the highest standard.

The identity of the pilots on board the aircraft has not yet been released.

Dan McGarry is media director of the Vanuatu Daily Post group. This article is republished with permission.

On the day of the arrival in Vanuatu of World Bank Vice President Victoria Kwakwa, tourism industry stakeholders are reportedly calling for a quick resolution to an apparent impasse over the selection of a contractor to perform the upgrades to the Bauerfield airport runway.

In late December, a World Bank procurement expert told bidders that she hoped to be able to announce the winning bid within a month of the tenders being unsealed. Nearly two months have passed, however, and no announcement has been made.

The Vanuatu Daily Post has received reliable reports that the crux of the delay is an impasse over the preferred contractor. Sources have confirmed that there are differing opinions about which one should win, and that price is a concern for at least one of the parties.

READ MORE: Vanuatu airport runway repairs usher in new tourism era

Most parties will not speak on the record because of the sensitive nature of the negotiations, but aviation stakeholders stated last week that they were ready to ask for high level government intervention in order to break the impasse.

Over the weekend, government representatives confirmed that they were willing to intervene in the process.

One political operative, who chose to remain anonymous due to the sensitivity of the affair, confirmed that a letter had been sent to a minister by tourism industry representatives, expressing concern at the economic cost of further delays.

It is widely known that several tourism operations are approaching the end of the line in terms of their ability to continue doing business at these depressed levels, and that any curbs on inflows over the upcoming peak season could spell disaster for them.

Expedited upgrade
The expedited runway upgrade bidding process had been designed with an eye to breaking ground in April, in order to ensure that any interruptions in service would not affect peak season tourist traffic.

Being able to announce completion of the runway upgrades by July might also have the effect of enticing Air New Zealand to return to scheduled service.

While arrival numbers from New Zealand are not huge, a vote of confidence from one of the most highly regarded airlines in the world would go a long way to reassuring travelers about the safety of the runway.

A completed runway upgrade might also convince Qantas to restore their code share with Air Vanuatu on their Sydney and Brisbane to Port Vila service.

Sources have confided that part of the problem stems from a lack of trust in the judgment of some parties. Vanuatu deferred to the World Bank’s choice of project manager during the emergency repair process, and later expressed regret when additional repairs were proven necessary.

Flight turned back
A Virgin Australia flight was turned back last year when additional damage was discovered on the runway, on a section that the project manager had deemed safe.

Nobody’s safety was affected because Airports Vanuatu Ltd was conducting visual inspections of the runway before every jet aircraft arrival and departure.

But the effect on the confidence of international tourism operators was palpably negative.

Parties to the negotiation have quietly accepted that the government’s position is understandable, and said that they view the Vice-President’s visit as an opportunity to “cut the knot” and move ahead with repairs to the runway.

Kwakwa is visiting the country to sign an agreement establishing a country office in Vanuatu.

She was joining at a signing ceremony yesterday by Minister of Infrastructure and Public Utilities, Jotham Napat, and Finance Minister Gaetan Pikioune.

Dan McGarry is media director of the Vanuatu Daily Post group.

• More airport upgrade delays

By Royson Willie in Port Vila

Prime Minister Charlot Salwai, as shareholder of the national carrier, has instructed Air Vanuatu not to terminate any ni-Vanuatu pilot employed by the airline.

The intervention by the head of government was made after it was brought to the prime minister’s attention that there were plans to terminate ni-Vanuatu pilots by the end of this month.

In a letter dated July 12, 2016, the prime minister instructed the board of directors chairman, John Lum.

The prime minister said he was informed that the management of the company was planning to take the action this month.

But Salwai noted that the employment contracts for the ni-Vanuatu pilots would end on July 31, 2018.

He said he was aware that steps were already taken “to bring more foreign pilots” into the country.

“In fact , one foreign pilot is already in Port Vila and he is waiting for his police clearance requested by Immigration in order to commence his employment.

‘No longer tolerated’
“I want to inform you that my government will no longer tolerate this action to continue to happen: no termination of ni-Vanuatu pilots of Air Vanuatu will be allowed,” he said in his instruction to the board chairman.

The prime minister as shareholder instructed the board to stop entertaining such policies but rather consider the national interest.

Salwai asked the board to review the airline’s current policy requiring that all ni-Vanuatu pilots must have an Airline Transport Pilot Licence (ATPL).

He said that the local pilots for Air Vanuatu’s domestic services were qualified to fly with a commercial pilot Licence (CPL) according to International Civil Aviation Organisation rules.

Salwai said the company’s policy should see the company finance the total cost of all its ni-Vanuatu pilots in achieving an ATPL.

“Air Vanuatu Operations Ltd is a national company and the investments made to develop its human resource shall be considered as investments for the development of this Nation,” the prime minister added.

The Daily Post contacted Air Vanuatu and the Prime Minister’s Office for further comments on the issue but none was made before going to press.

25 pilots
However, earlier this year in March the airline told the Daily Post that Air Vanuatu employed 25 pilots, of whom 14 were Vanuatu nationals and 11 were expatriates.

At that time the airline revealed that there was a recent review of salaries for new or junior pilots requiring further training in order to complete their ATPLs.

“Air Vanuatu is meeting the financial obligations of this training, which would otherwise require the pilots to fund themselves,” the airline said.

“We see this as a way of encouraging more ni-Vanuatu to apply for roles in aviation.

“This training takes between two and three years after which they can build on their flight hours and experience to become eligible for command positions, thus attracting a higher salary.”

Royson Willie is editor of the Vanuatu Daily Post.