It will apply to about 50 products, with Vanuatu being able to export agricultural products including coffee without duties or quantity restrictions.
In return, New Caledonia can supply processed food and building materials.
The agreement is yet to be approved by New Caledonia's Congress and Vanuatu's parliament.
New Caledonia's president Philippe Germain says the deal will enrich the region and make it economically more solid.
