A specialist in Vanuatu governance issues says the dissolution of the country's parliament could set back much-needed relief programmes.
The President, Baldwin Lonsdale, announced the dissolution and called a snap election last night, after the government and opposition failed to resolve a political impasse.
The opposition had argued against dissolution, which delays the passing of the budget at a time when the country is in the grip of a severe drought and still reeling from cyclone Pam in March.
The Australian National University's Siobhan McDonnell, who was an advisor to a former Vanuatu government, says the government is now in caretaker mode until an election sometime in the next two months.
"There are really critical disaster relief issues that seem to be coming to the fore now in Vanuatu. So the drought has been particularly extreme [and] this is a really critical time to really be governing well in Vanuatu."
McDonnell says relief programmes and other services can still run on current budgets and provisional funding, but most of their 2016 funding has to come out of a fresh budget.
She says the president's decision to dissolve the country's parliament comes as little surprise.
"The president's always been holding this card and he's been hoping that the government and opposition can find a way to govern, but at the end of the day he's obviously decided that that's not looking likely in the near future and so he's decided to dissolve parliament."
President Lonsdale said dissolution and a snap election were in the best interests of Vanuatu.
The government and the opposition have been trying to resolve a political impasse which began after 14 government MPs were last month jailed for bribery, with no success.