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FDI in Figures

According to the World Investment Report 2023 published by UNCTAD, FDI flows to Vanuatu were negative at -USD 4 million in 2022, following a positive flow of USD 43 million one year earlier. At the end of the same period, the stock of FDI was estimated at USD 705 million, around 70.4% of the country’s GDP. Traditionally, the industries that attract most FDI are food and wood processing. Australia is the main source of foreign investment in Vanuatu's economy with a focus on tourism (two-thirds of long-stay tourists to Vanuatu and the vast majority of cruise ship passengers come from Australia), finance, and construction, followed by Japan and New Zealand. The main ongoing project is the Vanuatu Aviation Investment Project (VAIP), which is supported by the World Bank and is aimed at repairing and rehabilitating Vanuatu’s three main airports, especially the Bauerfield International Airport. New initiatives and essential reforms contributing to the overall regime of doing business in Vanuatu have been undertaken on a regular basis as part of the Government's commitment to improving the country’s business environment thereby enhancing its attractiveness for private investors and encouraging greater investment expansions to the rural areas of the country (VIPA).

The factors that encourage foreign investors include an attractive tax system (no direct taxes), lack of exchange controls, a stable political situation, and a particularly proactive FDI promotion agency (the Vanuatu Investment Promotion Authority - VIPA). The country's vulnerability to natural disasters, the weakness of its infrastructure, and its geographical isolation remain some of the potential hindrances to investment. Property rights are poorly protected, and investment is deterred by the country’s inadequate physical and legal infrastructure. Business activity is further limited by rigid labor regulations and widespread corruption. Foreign investors may lease but not own land, and investment in some sectors of the economy may be screened by the government. The country has been working on the creation of Economic Development Zones (EDZs) for years although they have not materialized yet. The enforcement of contracts, the protection of minority investors, and the resolution of problems related to insolvency are three points on which the country has a large margin of progress. In 2023, Vanuatu introduced the Sustainable Citizenship by Investment Program. This initiative offers international investors the opportunity to obtain citizenship in Vanuatu by investing in the nation's sustainable economy. Starting at USD 165,000 for up to four family members under one application, the "CIIP – CNO Future Fund" choice channels direct investment into a sector of Vanuatu's economy highlighted in the Government's Low Emission Development Policy as pivotal for achieving its goal of carbon neutrality in electricity generation by 2030. Vanuatu ranks 61st among the 180 economies on the 2023 Corruption Perception Index and 65th out of 184 countries on the latest Index of Economic Freedom.


Country Comparison For the Protection of Investors

  Vanuatu East Asia & Pacific United States Germany
Index of Transaction Transparency* 5.0 5.9 7.0 5.0
Index of Manager’s Responsibility** 6.0 5.2 9.0 5.0
Index of Shareholders’ Power*** 5.0 6.7 9.0 5.0

Source: Doing Business - Latest available data.

Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action.

Foreign Direct Investment 202020212022
FDI Inward Flow (million USD) 2543-4
FDI Stock (million USD) 666.1708.7704.7
Number of Greenfield Investments*
Value of Greenfield Investments (million USD) 007

Source: UNCTAD - Latest available data

Note: * Greenfield Investments are a form of Foreign Direct Investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up.


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Tax Rates

Value Added Tax (VAT)
12.5% (standard rate)

Supplies which are exempt from VAT include financial services, education supplied by an approved educational institution, donated goods and services sold by non-profit organisations, residential rental accommodation, and the sale of a property which has been used for residential rental accommodation for at least 5 years.
Supplies which are zero-rated include exported goods, goods not situated in Vanuatu at the time of supply, taxable activities sold as going concerns to registered persons, international transportation of passengers and goods, services provided to non-residents who are outside of Vanuatu, services physically supplied outside Vanuatu, goods or services supplied directly to approved educational institutions and goods or services supplied to aid donors in respect of approved aid projects.

Company Tax
Withholding Taxes
Dividends: 0%, Interests: 0%, Royalties: 0%.
Bilateral Agreement
Vanuatu and Spain are not bound by a Double Taxation Agreement.
Social Security Contributions Paid By Employers
Employers must contribute to an approved superannuation scheme. The most common is the Vanuatu National Provident Fund, with a contribution equal to 4% of the salary being paid by the employer.
Other Domestic Resources
Vanuatu Customs & Inland Revenue Department
Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.

Individual Taxes

No personal income tax

Country Comparison For Corporate Taxation

  Vanuatu East Asia & Pacific United States Germany
Number of Payments of Taxes per Year 31.0 23.4 10.6 9.0
Time Taken For Administrative Formalities (Hours) 120.0 195.1 175.0 218.0
Total Share of Taxes (% of Profit) 8.5 33.8 36.6 48.8

Source: Doing Business - Latest available data.

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Investment Opportunities

Tenders, Projects and Public Procurement
Tenders Info, Tenders in Vanuatu
DgMarket, Tenders Worldwide
Setting Up a Company
Consult Doing Business Website, to know about procedures to start a Business in Vanuatu.
Useful Resources
Vanuatu Investment Promotion Authority (VIPA)
Contact the Spanish Embassy.
Contact the Embassy in Spain.

Business Setup Procedures

Setting Up a Company Vanuatu East Asia & Pacific
Procedures (number) 7.00 7.25
Time (days) 18.00 29.73

Source: Doing Business.


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Latest Update: May 2024

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