Economic
Vanuatu's growth expected to recover but outlook subject to risks
Vanuatu's growth is projected to recover to 2.8 percent in 2026 but remains vulnerable to significant downside risks and structural challenges.
The IMF Executive Board notes that Vanuatu’s growth is expected to recover to 2.8 percent in 2026 following recent shocks, with inflation in its target band and foreign reserves supported by external aid, remittances, and a recovery in tourism. However, the outlook is subject to significant downside risks and structural challenges reflecting heightened global uncertainties and domestic vulnerabilities. The current account deficit is projected to remain wide in 2025 and 2026 due to higher imports, while foreign reserves remain adequate but on a downward trajectory. The fiscal deficit is projected to widen in 2025 because of weaker revenues and increased expenditures related to post‑earthquake rebuilding, support for households, and Air Vanuatu’s operational needs, which create an economic threat environment.
- Status
- active
- Location
- Vanuatu
- Date added
- 2026-03-25 21:09 UTC
- Last updated
- 2026-03-25 21:09 UTC
- Connected threats
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- Not Available