MBA - Vanuatu - Business Environment Country Report for MBA 434 South Pacific Business Environment


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Business Environment Country Report - VANUATU (20%)
Groups will make a 20 minute presentation using PowerPoint on their assessment of the business environment in a Pacific Island Country assigned to their group.
Groups should analyze the business environment of the selected country and make a presentation using charts, maps, diagrams, photos and illustrations. Reports should cover:
Business environment and the World Bank ease of doing business survey findings for 2013
Country economic profile and private sector structure and performance
Economic outlook for sustainable development, green growth and investment
Review of the growth prospects of industries
Support for small business and entrepreneurship

Assessment Criteria for the Presentation
Quality of Oral and Visual Presentation
Logical structure of the presentation with table of content as second slide.
Clear presentation of the topic and the main issues
Quality of power-point slides
Use of graphs, charts, tables, photographs
Presenters engage audience with eye contact, confidence, enthusiasm, positive attitude, persuasive style
Timing and speed of presentation ( 20 minutes limit)
Evidence of thorough preparation
Collected information on the country from several websites, published reports and studies
Demonstrated a sound knowledge of the country business environment

MBA 434 South Pacific Business Environment @ The University of the South Pacific

This was to cover the required Case study (10%)
In groups of four or five people you will analyze a case study and apply tools presented during the lectures. From the 11 case studies we chose: Pure Fiji

The course covers key issues relating to the South Pacific business environment. Corporate social responsibility, regionalism, utilisation of natural resources, impacts of culture on business problems, labour relations, government support for business privatisation and the consequences of foreign investment will be considered. The relationships of business, culture and the natural environment, commercial law, as well as the ethics of various viewpoints and practices constitute major themes.

Stuart Gow
Archana Singh
Maxine Valentine

Date: January 2013

Published in: Business, Travel
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  • Originally called the New Hebrides, on 30 July 2010, Vanuatu celebrated 30 years of independence.

    Vanuatu has a republican political system which is currently headed by a President who is elected for 5-year terms by a two-thirds majority in an electoral college.

    This Electoral College consists of members of Parliament and the presidents of Regional Councils.

    The prime minister and the Council of Ministers constitute the executive government.

    Vanuatu has had a relatively prolonged period of political stability.

    Legal System

    The legal system of the country is based on English common law.

    The judiciary consists of the Supreme Court with a Chief Justice and a Magistrates Court. The highest court is the Court of Appeal.
  • Gov t health care system
    Not good enough for retirement investment
    Health Sector strategy 2010– 2016
    Comprehensive Reform Program (CRP)

    HUGE reduction since 2000
    Drop of 75% incidence (WHO 2011)

    This was done with a major program of mosquito nets throughout the country mostly, as well as better treatments and education of mosquito control

  • Roads
    Recent developments has seen the completion of tar-sealed road around the island of Efate, where Port Vila is located and the 57 km tar-sealed road of the east coast Highway on island of Espiritu Santo. This improvement was made possible by the Millennium Challenge Accounts (MCA)

    Port Vila’s ongoing congestion problem has been greatly improved with upgrade in wharf facilities including the provision of two tugboats.
  • By Air.
    Vanuatu’s national airline “Air Vanuatu” operates regular flights between Australia (10 time a week) and New Zealand (four times a week).

    The majority of overseas visitors may enter Vanuatu via Sydney.

    Visitors may also enter Vanuatu via Fiji and New Caledonia. Air Calin operates two flights per
    week to Port Vila.

    By Sea.
    If you are intending to send materials by sea, international vessels enter Vanuatu via Australia, New Zealand and Fiji.

  • Airports
    With its new cargo terminal and extension of run-way underway,

    Bauerfield is set to accept larger aircraft.

    Santo’s Pekoa’s Airport was also upgraded and now handles international flights.

    Improving domestic airports in the outer islands remains a key priority activity for the Government.

    The most dramatic recent development has been in the area of mobile phones. The arrival of Digi-cel has seen very strong competition between the Vanuatu TVL - leading to affordable prices in mobile phones. Communication is now easy nation-wide and with good signals.

    Internet has also improved significantly. A new development which will further boost communication services within the country has been the E-Govt Network.

    Once the network and databases and software have been configured, it will revolutionalise the way the way government operates and the speedof communication nation-wide.
  • MBA - Vanuatu - Business Environment Country Report for MBA 434 South Pacific Business Environment

    1. 1. Country Report to Vanuatu Cabinet ~ October 2013 Archana Singh S99000405 Maxine Valentine S97002304 Stuart Gow s11100919
    2. 2. Vanuatu Scope Country Basics Infrastructure Business Environment Foreign Trade Business Sectors Investment Promotion Sustainability Recommendations
    3. 3. Vanuatu Vanuatu 101
    4. 4. Vanuatu Location in South Pacific
    5. 5. Vanuatu Vanuatu Geography Land area 14,760 Km2 More than 80 islands Several active volcanoes Languages, over 112: English French Bislama Native languages
    6. 6. Vanuatu Population 2012 Total Population 250,000 Males 119,091 Females 114,932 Av. growth rate 2.3% Population density (per 21 49% 51% Females Males
    7. 7. Vanuatu Structure 2012 Age Dependency Ratio 71 Structure 2012 < 15 years 90,973 15 - 24 years 45,423 25 - 59 years 83,821 60+ years 13,806
    8. 8. Vanuatu Urbanisation Urban population 57,195 Urban growth rate 3.5% Percent urban (%) 24.4
    9. 9. Vanuatu
    10. 10. Vanuatu Dual Society “Have” & “Have nots” 65% Population Subsistence Living
    11. 11. Vanuatu The Happy People Index Vanuatu #1 !!!!
    12. 12. Vanuatu Political Political System Legal System Independence: July 1980 Republican system Political long term stability English common law Supreme Court Magistrates Court
    13. 13. Vanuatu Health Care Hospitals & Clinics Malaria Gov t health care system Not good enough for retirement investment Health Sector strategy 2010– 2016 Comprehensive Reform Program (CRP) Marked reduction since 2000 Drop of 75% incidence (WHO 2011)
    14. 14. Vanuatu Millennium Development Goals MDGS Goal 1: Eradicate extreme poverty and hunger Target 1: Halve between 1990 and 2015 the proportion of people whose income is less than one dollar a day. Target 2: Halve, between 1990 and 2015, the proportion of people who suffer from hunger
    15. 15. Vanuatu Millennium Development Goals MDGS Goal 2: Achieve universal primary education Target 3: Ensure that, by 2015, children everywhere, boys and girls alike, will be able to complete a full course of primary schooling 2012 Literacy Rate 81%
    16. 16. Vanuatu Roads Ports Airports Telecommunications Utilities
    17. 17. Vanuatu Infrastructure Roads Ports New tar sealed roads Efate Espiritu Santo Funding by Millennium Challenge Accounts (MCA) Upgraded wharf facility Port Vila 2012 2 new tug boats (ADB)
    18. 18. Vanuatu Global Connectivity Air Sea Good air connections Airlines: Air Vanuatu Fiji Airways Pacific Blue Air Calin International port: Port Vila Regular shipping from: Australia New Zealand
    19. 19. Vanuatu Infrastructure Airports Telecommunications Bauerfield (Efate) new cargo terminal extension of runway Pekoa’s (Santo) International flights Government priority: Improving domestic airports Mobile networks increased Internet connection New Cable to Fiji?
    20. 20. Vanuatu Infrastructure Electricity Water/Sewerage Govt Supplied to only Main islands, only 28% population No Electricity in most villages Generators Limited Alternate Power Projects to date Potential for hydropower generation geothermal sites In city of Port Vila Piped in some villages Streams & rivers Video(1.40Min) showing women carrying water
    21. 21. Vanuatu
    22. 22. Vanuatu Vanuatu GDP Currency: Vanuatu vatu ($1.00 FJD = $51.00 VUV) Nominal GDP: $580 million Real GDP Growth Rate 1.1% Inflation Rate(consumer prices): 3.1% GDP per Capita purchasing power parity - $2,900 (20011 est.) Natural Resources: Forest Marine resources Agricultural Land
    23. 23. Vanuatu Performance of Government
    24. 24. Vanuatu Public Debt & Reserves
    25. 25. Vanuatu Credit to private Sector
    26. 26. Vanuatu Ease of doing business World Bank recent report
    27. 27. Vanuatu Economy Ease of Doing Business Rank Filtered Rank Tonga 57 1 Samoa 61 2 Fiji 62 3 Vanuatu 74 4 Solomons 97 5 PNG 113 6 Kiribati 122 7 Micronesia 156 8
    28. 28. Vanuatu Ease of Doing Business Ranking
    29. 29. Vanuatu Inflation
    30. 30. Vanuatu Prices Inflationary pressures Consumer price index inflationary pressures may materialize 2014 Average inflation rate to remain within the central bank’s 0%-4.0% target range June Qtr 2013 increase by 0.2% over the previous quarter Reflecting slight slowdown in economic activity
    31. 31. Vanuatu Foreign exchange reserve Dec 2012 VT17.5bn 7.4 months imports
    32. 32. Vanuatu Labour Force Statistics 2009 Employed 42,295 Subsistence workers 41,877 Males 21,942 Females 19,935 Labour Force Participation rate 70.9 Unemployment rate 4.6 Males 4.1 Females 5.2 Employment-population ratio 30.3 Literacy Rate 81%
    33. 33. Vanuatu International Memberships British Commonwealth French League of Nations United Nations Agence de Co-operation Culturelle et Technique South Pacific Bureau for Economic Co-operation (SPEC) Secretariat of the Pacific Community World Bank Asian Development Bank
    34. 34. Vanuatu Current Foreign Trade 2012
    35. 35. Vanuatu Imports • Food & live animals • beverages & tobacco • machinery & transport equipment • mineral fuels, lubricants & related
    36. 36. Vanuatu Exports Copra Agriculture (beans) Beef Cocoa Fisheries
    37. 37. Vanuatu 2012 Balance of Payments Growth Rate of Merchandise Exports (%) 24.6 Growth Rate of Merchandise Imports (%) 1.0 Trade Balance (% of GDP) -24.4 Current Account Balance (% of GDP) -6.0 ADB Economics and Research Department Development Indicators
    38. 38. Vanuatu
    39. 39. Vanuatu Private Sector Structure and Growth
    40. 40. Vanuatu Tourism Tourism >40% GDP Concentrated on Efate Large growth in Cruise Sector Increase in tourist arrivals in 2012-13
    41. 41. Vanuatu Fisheries Tuna fisheries 2nd largest export
    42. 42. Vanuatu Agriculture Coffee Beef Tanna Coffee (premium) High quality organic beef
    43. 43. Vanuatu Agriculture cont. Copra Cocoa & Kava Latrge tracts of Plantations Volatile global prices Possible biodiesel Cocoa specialty
    44. 44. Vanuatu Forestry Sustainable promoted Timbers? Teak sandal wood High grade high price specialties Agro-forectry
    45. 45. Vanuatu Offshore financial services Currency: Vanuatu vatu NO TAXES! Major Banks present: ANZ WestPac Bred BSP
    46. 46. Vanuatu Vanuatu Investment Promotion Authority
    47. 47. Vanuatu Vanuatu Investment Promotion Authority Formed byVFIP Act Promoted Sectors Agriculture Fisheries Forestry Tourism Manufacturing
    48. 48. Vanuatu UN WAIPA Website Clear & smooth Up to date All info given Languages : French Chinese Japanese Korean
    49. 49. Vanuatu Forward for a Green Economy...
    50. 50. Vanuatu Green tourism Tourism Development Plan Possible Solutions Currently no Dev. Plan! Encourage sustainability Energy efficiency Low impact Building Codes Tax incentives Tax allowance Tax Holidays Eco-tourism Low footprint tourism
    51. 51. Vanuatu Energy Efficiency Policies & Regulations Framework Solutions No National Energy Policy Framework Chance to develop a renewable energy policy No indigenous sources of fossil fuels mini grid diesel generation coconut oil conversions Geothermal Solar PV systems Hydropower Wind Hybrid with mixed renewable energy
    52. 52. Vanuatu
    53. 53. Vanuatu Strengths Strong financial centre Tax Benefits Reasonable labor cost Duty exemptions in imports in Tourism Manufacturing/ Processing Mineral Exploration & Extraction Diesel fuel for generation of certain electric power Fishing Industry Equipment for village and rural fishing projects No income tax No withholding tax No capital gain tax No death duties No foreign exchange controls Easy repatriation of profits
    54. 54. Vanuatu Weaknesses Bad infrastructure Uneducated workforce Limited international flights Bad health levels and care Malaria Primitive culture Medical & Dental Costs highj
    55. 55. Vanuatu Opportunities Agriculture Tourism Investing in agriculture Export market Tanna Coffee Skin Care products (copycat ) Infrastructural development Income Tax (tax on consumption) Green Tourism
    56. 56. Vanuatu Threats Agriculture Tourism Global coffee prices (commodity) Copra volatile Tourism: small player Fiji Gold Coast PNG
    57. 57. Vanuatu
    58. 58. Vanuatu Sustainability Implement some form of Environmental Protection Laws Use ADB and AUSAid to assist with this (like Fiji did) Implement renewable energy in a National Energy Policy Framework Promote Green Tourism businesses
    59. 59. Vanuatu Improve Airports High cost economy Cost of infrastructure Spread tourism dollar Link outer islands
    60. 60. Vanuatu SME Support and Microfinancing Make microfinance available Encourage MSME development Sustainable businesses Possible ADB or AusAid assistance
    61. 61. Vanuatu Agricultural Business Incubator Start-up a agri-incubator Get banking/ microfinance support for SME agri-projects Tourism suppliers Export Organic?
    62. 62. Vanuatu Tourism Cruising Sector Green tourism P&O very heavily invested Further encourage by continuing support Large Govt income from Port Fees New Tourism Development Plan Focus on Green Tourism Development
    63. 63. Vanuatu
    64. 64. Vanuatu References Australia Broadcasting Cooperation Vanuatu Economic Report 2009 Vanuatu Economic Report 2012 Australian High Commission in Port Vila website. Updated April 2011 2011 Index of Economic Freedom Doing Business 2012 Vanuatu Government of Vanuatu website: AusAid Website :
    65. 65. Country Report to Vanuatu Cabinet ~ October 2013 Archana Singh S99000405 Maxine Valentine S97002304 Stuart Gow s11100919