VT2 Billion Gov't Stimulus Package

The government of Vanuatu, through its Council of Ministers (COM), approved an economic stimulus package yesterday totaling 26.28 billion Vatu, aimed at revitalizing private sector confidence and supporting economic recovery following the earthquake. This plan covers several key areas, striving to comprehensively promote economic reconstruction. This initiative is expected to provide a much-needed boost to the nation's economy.

Specifically, 561 million Vatu will be allocated for wage subsidies, planned to be distributed to over 800 unemployed employees within three months. Minister of Finance and Deputy Prime Minister Johnny Koanapo stated that the government will strengthen oversight to ensure that businesses effectively distribute the funds to their employees. The government will take appropriate disciplinary action against businesses that fail to comply with the regulations, ensuring accountability and transparency.

Furthermore, 312 million Vatu will be used for demolition costs to ensure the central business district (CBD) can be reopened quickly and safely, which is crucial for Vanuatu's economy. Minister Koanapo emphasized that if private building owners fail to act swiftly, the government will bear the demolition costs. He stressed that reopening the CBD as soon as possible is a top priority, as delays will cause greater losses. To boost confidence in the tourism industry, the Vanuatu Tourism Office will receive a marketing grant of 100 million Vatu.

The government will also provide 62 million Vatu in grants to support over 1,000 micro-enterprises and inject 1 billion Vatu in loan guarantees for earthquake banking operations. Minister Koanapo stated that the government will negotiate with banks willing to support affected businesses. He also added, "The government is considering exempting value-added tax on building materials, amounting to 100 million Vatu, but subject to relevant terms and conditions to ensure responsible use of public funds."

Minister Koanapo stated that the Council of Ministers has authorized him to be responsible for managing the implementation of this economic stimulus plan. He hopes to launch the plan as soon as possible. He also assured that the funds are ready and these economic measures can be implemented immediately. In addition, 197 million Vatu in school fee subsidies and support for private and vocational schools will be implemented according to specific criteria developed in consultation with the Council of Ministers. Another 30 million Vatu will be used for the implementation of the stimulus plan, ensuring its smooth execution.