VFIPA develops new strategy to drive Foreign Direct Investment

November 19, 2024 10:05 pm | Posted in Business News | Share now TwitterFacebook

By Adorina Massing.

Vanuatu Foreign Investment Promotion Agency (VFIPA) has developed a new Investment Promotion Strategy to assist in identifying foreign investments required for the country, which can create employment opportunities, generate income wealth and support Government services.

A VFIPA workshop to launch the new strategy was held last week at Ramada Resort with the presence of Government and Private Sector representatives, as well as plenary discussions from a technical expert, Carlos Griffin from United States.

Griffin is a Foreign Investment and Trade Consultant for the World Association of Investment Promotion Agencies (WAIPA).

VFIPA Chief Executive Officer (CEO), Raymond Vuti conveyed that as a member of WAIPA, the workshop is a milestone achievement for VFIPA in terms of developing its first-ever Investment Promotion Strategy.

“Based on experiences and lessons learnt from the drafting stage, at first we had no target on what type of Investment we think is perfect for us to attract into our country, but this new strategy will greatly assist and guide us,” he said

According to its website, VFIPA is a statutory body that promotes Foreign Direct Investment (FDI) in Vanuatu and operates under the Ministry of Trade and Commerce.

The CEO explained VFIPA’s role is to promote Vanuatu as an investment destination and register every foreign business under VFIPA and to offer expert facilitation services during the investment decision-making process including advice and other information relating to entry and business start-up requirements, investment opportunities, location and changes in policies and regulatory requirements.

“VFIPA’s role is to promote foreign investments to Vanuatu and is the ultimate gateway for any foreigner who wants to come to Vanuatu to establish their business,” he said.

“We make follow-up visits to their project sites to see if they have any issues with their business and how we can assist them.”

During the workshop, presentations include how Vanuatu’s demonstrated attractiveness to FDI includes projects from 30 economies, globally.

Vanuatu’s source economies for FDI are highly concentrated, with 82% coming from well-established tier of just four countries: Australia, China, France and New Zealand.

Another seven economies represent a distant-second, emerging tier, which collectively represent just 13%: South Korea, Japan, US, Fiji, UK, Canada and Philippines.

The business activities attracting these projects are likewise quite concentrated.

CEO Vuti clarified that Vanuatu’s FDI refers to business people especially foreigners who have established businesses in the country, foreign investors include; China Civil Engineering Construction Corporation (CCECC) in charge of building roads, Vodafone and Digicel as telecommunication companies and Starlink.

“FDI is important since the Government’s priority is to provide services to the people in every sector but our Government has not enough resources to provide these services, so they need additional support in terms of funding, thus, when Foreign Investors are here to establish themselves in Vanuatu, they bring extra finances that could help Vanuatu Government to execute those services,” he said.

Vanuatu’s demonstrated attractiveness to FDI is mostly in service sectors, led by international tourism, import and resale of goods and professional services for the domestic market.

“Tourism is the leading sector generating more investors and income into the country,” said Vuti.

“More support is needed for the Agriculture Sector in terms of increasing production and manufacturing products, a real challenge is access to lands which remains an issue for Commercial Farming to grow in the country.

“We need more support to create more awareness for our farmers on how land can be accessed and utilised for commercial farming.”

The CEO also confirmed a proposal was submitted to the Council of Ministers (COM) during the former Minister of Trade’s term, Matai Seremaiah, who believed there should be an institutional reform in the Ministry.

“The proposal has considered the export portfolio should be part of the VFIPA mandate so it can promote both Foreign Investments and Local exports, it also means that VFIPA would not only focus on foreign investors but also with the consideration of domestic investors too,” Vuti said.

He noted that the proposal has not progressed to the level of expectations but it has been submitted.

“We look forward to the completion of this new strategy as an outcome of this workshop. One of the immediate activities, which is considered a top priority for VFIPA, is to strengthen partnerships and relationships with other government departments and the private sector, both of which are involved in and facilitate FDI into the country,” Vuti said.