Vanuatu is entering an exciting new phase in its development. Having gained independence in 1980, the sleepy islands of Vanuatu have enjoyed limited economic development and like most other island countries, the period after Independence has been a relatively difficult one. Also, Vanuatu is in the unique position of having been a Condominium under the British & French Governments. During the period after Independence, Vanuatu’s agricultural, tourism sectors and financial sectors grew slowly but in the last 18 months to 2 years, many living in this Country have noticed the beginnings of a major economic upturn. Spearheaded by the Government’s Comprehensive Reform Programme which involved a Reform of the public sector, the introduction of a broad based Valued Added Tax (VAT) and changes in infrastructure, Vanuatu is now poised to grow significantly.

One has noticed an increase in economic activity and in particular a significant increase in Property Investment from overseas in recent months.

The Vanuatu Government has always been receptive to overseas investment and with the introduction of the Vanuatu Investment Promotion Authority (VIPA) several years ago it has become much easier for foreign investors to invest in this Country. VIPA has also streamlined the process of Business Licences and Residency and Work Permits for foreigners.

Many consider Vanuatu to be the ‘undiscovered jewel of the Pacific’ with its cosmopolitan, English-French background and believe it is shaping up to be a truly wonderful place to live. Already this year we have noticed a significant increase in tourism with the introduction of a second aircraft by Air Vanuatu and just recently the introduction of flights from Melbourne and Brisbane by Pacific Blue. This resulting increase in tourism will have an almost immediate impact on the economy. It is expected that the future will hold major growth in the tourism sector.
Persons interested in investing in land will notice they can still purchase waterfront leasehold land, only minutes from the Capital for much less than what they would pay in countries like Australia. Building costs are comparable to those in Developed Countries, so the exercise of purchasing land and building your residence can be very good value indeed.

Another development which is also making property and interesting investment is the recent introduction by the Vanuatu Government of Strata Title Legislation and its associated regulations which will make the commercialisation of property in Vanuatu much easier, further making it attractive to foreign investors.The Ni-Vanuatu population of Vanuatu are amongst the friendliest in the Pacific. A good relationship has always existed between Vanuatu’s Ni-Vanuatu and expatriate populations. The Ni-Vanuatu population of Vanuatu acknowledge that foreign investment is a most important part of the Country’s continued development and it is this attitude particularly which makes Vanuatu an attractive place in which to invest.

In the next 10 years, Developed Countries in the Region such as Australia and New Zealand are expected to have large babyboomer populations retiring and this group are just now discovering Vanuatu as a place to retire. It is expected that retiring babyboomers will come to Vanuatu, purchase land and build houses and further contribute to the development of the economy through their significant spending power. One interesting aspect of the Vanuatu economy which is proving particularly attractive to retirees is the fact that there is no Income Tax in the Republic of Vanuatu. The Government have opted for system of indirect taxation and the fact that there are no Income Taxes, means that the accumulated wealth of babyboomers is not subject to any form of Income Tax in the Republic of Vanuatu.

Moores Rowland is a Member of Moores Rowland International which is a world-wide Association of Independent Accounting Practices and ranks eight (8th) in size internationally. It has been represented in Vanuatu for more than 28 years and with its associated trust company, Guardian Trustees Limited and real estate company, Transpacific Real Estate is able to offer the foreign investor and potential retiree
a unique blend of advice and insight into investment in Vanuatu.
 

Laurie HARRISON

Partner - Moores Rowland