mega888 Vanuatu Business Review » The glass is half full… don’t drop it

The glass is half full… don’t drop it

By Tess Newton Cain, TNC Pacific Consulting

Tess Newton Cain

I have access to a number of people who fall into the ‘grumpy old men’ demographic. And just recently, they are not playing true to form. They can’t do anything about the ageing process and (as far as I am aware) they are not signing up for gender reassignment surgery. The aberration is that they are not being grumpy.

Admittedly this is a spectrum – there aren’t many at the ‘jumping for joy’ end and there is a significant cluster at the ‘well it couldn’t get much worse’ point on the curve. But overall, I am struck by the increasing and persistent levels of optimism within the business community across a number of sectors.

This optimism is well-founded. The return of Virgin Australia to our flight schedule is a boost for the tourism industry and a very welcome vote of confidence in the government’s ‘will do’ approach to addressing the issue of runway repair in a timely and competent manner. The development of an agreement between Air Vanuatu, Solomon Airlines and Air Niugini opens up further opportunities, especially if we move quickly to access the often overlooked (but potentially lucrative) market of Papua New Guinea.

Plus, we have seen significant re-openings of major properties with the direct and indirect benefits they bring. We can’t ignore the large number of tourism related business that are currently in receivership, as this is a very real indication of just how much this sector has suffered during the last 12-18 months. The silver lining is that these businesses have, by and large, been able to continue operating and keep their staff employed (even if on reduced hours) and are now proving attractive to new investors, looking to establish themselves in Port Vila and elsewhere.

The news from real estate agents, business brokers and others is that there is serious money coming into the country, with much of it being from relatively new sources, including China and the USA. These investors are predominantly interested in tourism opportunities and real estate, both domestic and commercial. This means that their impact is very visible in Port Vila and Luganville but less so in rural and remote areas.

After a delay, we are now seeing rehabilitation funding flowing into reconstruction of public infrastructure and the much awaited work on roads and urban development projects is in full swing. All of this is increasing the amount of cash within the economy and as consumption is restored and maintained, the government’s revenue (via indirect taxation) can be sustained.

That is not to say there are not potential pitfalls ahead. First and foremost is the need to develop economic opportunity for as many people as possible, including and especially those in rural locations.

When Iririki Island Resort opened just a few weeks ago, the prime minister made a very important speech. He reassured the tourism industry that his government understands the importance of that sector to the future prosperity of the country as a whole. He then stressed the importance of this sector as an internal market for our primary producers and called on tourism owners and operators to create more and better linkages throughout the economy.

In order for the Salwai government to continue to respond to the requests of one sector, ministers and MPs need to be able to demonstrate that in doing so they are indeed creating opportunities for their rural constituents. The Port Vila/Luganville centric tourism industry has an important role to play in helping them achieve this and has much to gain from doing so.

The business community of Vanuatu has weathered a series of storms just recently and we are all breathing a sigh of relief that just now things are going well, overall. The glass is half full and with care and attention we can avoid serious spillage and continue to fill it going forward.

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