ADB, New Zealand to Improve Domestic Shipping in Vanuatu

PORT VILA, VANUATU – Water transport, the economic lifeline of Vanuatu, is set to see upgrades with the Asian Development Bank (ADB) and governments of New Zealand and Vanuatu signing loan and grant funding agreements today to improve domestic port facilities and expand shipping services to remote islands.

“Working alongside the governments of New Zealand and Vanuatu, we look forward to introducing a competitive, reliable, safe and cost effective interisland shipping service to remote areas, which will stimulate economic growth at the same time,” said Robert Guild, Director of Transport, Energy and Natural Resources Division of ADB’s Pacific Department.

Improved shipping and port facilities will support national development and promote new economic opportunities for isolated rural communities. It will also develop services on routes that have so far been commercially unviable. The project, which will finance the building of a new interisland terminal in the capital, Port Vila, and construct new jetties on the islands of Malekula, Ambae, Tanna and Pentecost, will also rehabilitate several jetties in remote areas.. The project is expected to take 5 years to complete.

“For New Zealand, the Vanuatu Inter-Island Shipping Project represents a significant investment in Vanuatu’s sustainable economic development, which is a priority for us.  This project has been a long time in the making.  It was first proposed to us by the Vanuatu Government several years ago, and we look forward to working with Vanuatu and the Asian Development Bank, during the next five years, to implement these much needed improvements to Vanuatu’s inter-island shipping infrastructure, services and governance.  We welcome the Asian Development Bank’s involvement, which reflects New Zealand’s wish to achieve improved development outcomes for Pacific Island Countries through strategic partnerships with other development agencies,” said Bill Dobbie, New Zealand’s High Commissioner to Vanuatu.

The new interisland terminal in Port Vila will provide sufficient berths to handle the growing volume of vessels, as well as separate transit facilities for men, women and the disabled. New jetties will be built at Port Sandwich (Malekula); Lolowai (Ambae); Waisisi (Tanna), and Loltong (Pentecost). Existing jetties at Litzlitz (Malekula); Lenakel (Tanna) and Simonsen (Espiritu Santo) will be repaired or rehabilitated.

“In signing this agreement today on behalf of the Government and the people of Vanuatu, of which I believe is another chapter in the Vanuatu’s record to show our strong partnership with the ADB and development partners. The government and the people of Vanuatu realize that achieving economic broad-based growth that is sustainable over time is very important for the economic advancement of this nation. That is why we are investing in the improvement of shipping and port facilities which will definitely support national development and promote new economic activities for isolated rural communities in Vanuatu,” said Moana Kalosil Carcasses, Vanuatu’s Minister of Finance & Economic Management.

“This new investment will complement the existing road project upgrades funded by the Australian Government, through the Vanuatu Transport Sector Strategy Project in the outer islands to better facilitate domestic and international trade as well as providing separate transit facilities for travelers. This will generate additional employment and income while at the same time redistribute income and increase consumption. It is expected that this infrastructure project with others combined, will contribute to raising all ordinary people’s standard of living,” Kalosil Carcasses said.

“So I encourage other development partners to also provide the same opportunity to the government so the government can in return utilize these supports to promote and build a stronger and cohesive economic growth that will benefit the people of this nation. I would like to thank the ADB and the New Zealand Government in this collaborative effort to assist the Government and people of Vanuatu, providing funding to improve the domestic shipping development in Vanuatu,” he said.

“I believe it is very timely for the people of Vanuatu to receive these types of international assistances through the New Zealand Government and the ADB to upgrade existing and build new berths particularly for those provinces identified in the outer islands,” Kalosil Carcasses said.

ADB’s loan of $10.82 million equivalent from its concessional Asian Development Fund has a 32-year term, with the Government of New Zealand providing a co-financing grant of $12.6 million equivalent directly to the Government of Vanuatu. The Government of Vanuatu will contribute $3.4 million, for a total project cost of around $26.8 million.

The technical assistance will include a $500,000 grant from ADB’s Technical Assistance Special Fund, a $1 million grant from the Government of New Zealand, to be administered by ADB, and about $500,000 from the Government of Vanuatu.