IFAD does not currently have active operations in Vanuatu.

The Context

Vanuatu is an archipelago of 83 islands that span nearly 1,300 kilometers north to south. Located in the Pacific Ring of Fire, the majority of Vanuatu’s islands are of volcanic origin and are relatively higher than most other Pacific Island countries. Like other small island developing states, Vanuatu has an acute vulnerability to climate change, natural disasters and global shocks, and limited capacity to cope or recover. Vanuatu’s vulnerability has consistently ranked it as the most at risk country globally under the UN’s World Risk Index since the index was launched in 2011.

Vanuatu’s population of 270,000, spread across 65 inhabited islands, is about 75% rural and very young (64% under 29 years). In 2016, about 88% of households were engaged in vegetable crop production (97% in rural areas, 62% in urban areas) and 57% engaged in cash crop production (74% in rural areas, 9% in urban areas). Population is growing quickly at 2.3% a year—nearly double the global average—with higher urban growth rates. Rural demographics are rapidly changing as young people migrate away from rural areas toward urban centres in search of decent work. But job creation is not keeping pace with population growth and agricultural productivity in rural areas has become more burdensome for those left behind to maintain family farms.

In 2018, Vanuatu’s services sector contributed 60% of GPD, the productive sector (agriculture, fishing and forestry) 21%, and industry 10%. But after a decade of stop-and-go growth, the severe 2020 economic crisis provoked by the COVID-19 pandemic and tropical cyclone Harold has contracted the economy by 9.2%, created challenges in controlling debt exposure and exacerbating Vanuatu’s trade imbalance. Vanuatu’s government has focused its economic recovery on boosting agricultural production and value addition especially within three targeted value chains: coconut, beef and fruit and vegetables.

Integrated approaches to both economic and health challenges are of urgent importance in Vanuatu, which suffers from the 'triple burden of malnutrition'—persistent undernutrition and micronutrient deficiencies coexisting with a growing burden of obesity and related non-communicable diseases. Vanuatu is particularly affected by child stunting (stunting under 5 years of age was 28.5% in 2016) and adult obesity (20.7% in 2016). The current policy focus on rural revival and the agrarian economy is directly linked to the health benefits of a revitalized productive sector—including improving access to nutritious foods and enhanced local food systems.

The Strategy

For over 30 years, IFAD has been engaged in the Pacific promoting pro-poor rural transformation focused on inclusion, innovation, community development and smallholder agriculture. IFAD’s reengagement with Vanuatu will focus on supporting the government in developing scalable investments in agriculture and the rural economy. IFAD will work in close collaboration with government ministries and other strategic partners to

• intensify climate resilient and sustainable food production practices among smallholder farmers and fishers;
• increase access to nutritious foods;
• boost agribusiness, market access and linkages between producers and private sector companies; and
• increase the resilience of rural households in the face of persistent climate vulnerability.

Given the dispersed reality of Vanuatu’s 83 islands, IFAD emphasizes developing scalable pathways and solutions that maximize resources and ease absorptive capacity constraints to create viable, climate-smart, equitable interventions that can reach even the most remote and vulnerable communities.

A pillar of this approach is building local skills and capacities for self-reliance and sustained service provision. Throughout the Pacific, IFAD promotes community-driven development by strengthening local participation and governance mechanisms to engage rural communities with national policy and planning processes. This approach facilitates increased involvement of all community members, and crucially, that of women and youth.

Agricultural support will also act as a springboard to empower women and youth, validating their economic contribution and building knowledge and social consensus around their expanded participation in economic and decision-making realms. IFAD’s strategy in Vanuatu will include effective mechanisms of support to enable youth and women’s participation in community affairs and decision making, strengthening of women’s groups, access to financial resources and benefits, and specifically designed outreach and training efforts to promote women and youth entrepreneurship.