Vanuatu’s current Months of Import Cover indicates that the country remains stable in terms of foreign reserves, ensuring its ability to continue paying for imported goods despite recent disasters.

This week, Reserve Bank Governor August Letlet revealed that Vanuatu’s import cover stands at 7.2 months, exceeding the required threshold for economic stability.

“Months of import cover is a very important indicator for understanding local economic development. As of February, Vanuatu’s import cover stands at 7.2 months. This means that even if we do not generate additional revenue, we can still afford to pay for imports for the next 7.2 months,” Letlet explained.

He further noted that while the figure is currently strong, the challenge lies in reducing import cover to stimulate economic activity. “Instead of increasing the months of import cover, we should focus on reducing economic constraints to improve cash flow and business activity,” he added.