The Government will shift its COVID-19 and Cyclone Harold economic support to agricultural production, saying continuing a broader crisis support package beyond the end of July is not sustainable.
The Government announced its nation-wide VT4.2 billion stimulus package in April in the wake of big job and business losses as COVID-19 and Cyclone Harold impacted the country.
The Council of Ministers announced the shift to sector-specific support after its latest meeting, saying its broader economic stimulus package, the largest ever made by a Vanuatu Government, was no longer sustainable.
The council announced Employment Stabilisation Payments that were part of the broader package would finish at the end of July. The package had been due to finish at the end of June.
Finance Minister Jonny Koanapo said the Government had to find a more sustainable way to deal with Vanuatu’s tough economic challenges from August onwards.
He says the Government believes the best way to do that is to focus economic support on particular sectors of the economy.
With Cyclone Harold damaging local food production and COVID-19 interrupting imports of some food items, he says the Government believes focussing support on the agricultural sector is a priority.
“In the event where COVID-19 [restrictions] last until next year and beyond … the country must be able to produce enough food to feed itself,” Minister Koanapo said.
“So money will be allocated to the [agricultural] production sector to ensure that farmers are able to produce enough food for our population.”
Minister Kanapo said, not only farmers will benefit from the support. They will produce more food which will benefit 75–80 per cent of the population and the increased food production will also boost exports.
“I am asking for everyone’s understanding at this difficult time,” the Minister said.
Minister Koanapo said as well as a focus on agriculture, to support local businesses, the Government will be injecting funds into the banking sector.
This support will allow the banks to provide low interest rate loans to businesses so they can continue to operate.
The Director of the Department of Agriculture Antoine Ravo, said he is happy about the decision to focus the Government’s crisis economic support on the development of agriculture.
“Agriculture is always the back bone of the food security and rural economy of a nation,” he said.
“This is a good thing to go back to the roots of agriculture and plant more food, to stay healthy and explore more opportunities.
“This way in the next three to four years and when markets are open again we will have enough food to export.”