Vanuatu reports strong economic growth in 2017

Preliminary estimates released by the Vanuatu National Statistics Office indicate the economy grew by 4.4 per cent in 2017 reflecting a strong performance over the last three years.

The strong performance in 2017 can be attributed to the positive growth in all three industries, agriculture, industry and services.  

The GDP growth in 2017 was mainly driven by industry, followed by services and agriculture.

A VNSO release said though the overall performance in industry has continued from the strong growth in two previous years, its contribution to GDP growth is less than services and agriculture.

In terms of contribution by industries, services have the largest share of 65 per cent which contributes to a positive growth of 1.8 per cent in 2017 followed by agriculture fishing and forestry. 

Agriculture, Fishing and Forestry has continued to grow following the level of output shown in 2016 by registering a positive growth of 0.4 per cent. The sub-components of agriculture that contribute to this positive growth, were crop production, which grew by 0.4 per cent, followed by fishing at 3.9 per cent and forestry at 1.5 per cent, while animal production decline by 3.1 per cent.

Crop production forms a dominant 80 per cent share of the total output in agriculture; therefore a weak growth has driven the industry down contributing to slow growth in overall agriculture industry.

Copra production continues to grow following the rise in 2016 average price from VT 51,000 to 59,000 per ton in 2017. Cocoa price were more stable than in previous years; however production has been restricted over long period of time due to low yield from plantation where trees were old and unproductive.

The level of production has gone down in 2017 compared to 2016.

Industry continued to improve following the strong growth in 2016.

The main driver construction continues to grow following the post-Tropical Cyclone Pam reconstruction and ongoing infrastructure projects.

Despite the wind down of major donor-funded infrastructure projects in the second half of 2017, the ongoing projects, which include; the Port Vila Urban infrastructure projects and Vanuatu Road Rehabilitation road projects in Malekula and Tanna have progress well towards the end of 2017.

1 In 2017 it recorded an increase of 10 per cent with a total value added at constant, 2006 prices of VT 3,881 million. Electricity and water continue to grow following the strong recovery in 2016 by registering a positive growth of 4.2 per cent in 2017.

This increase is reflected in the level of consumption for electricity and water which result from the increasing investment on the infrastructure in Efate, Malekula and Tanna.

All components have contributed positively, for manufacturing it continues to expand following positive growth in the previous year by registering a growth of 2 per cent in 2017; it is a fragile industry mostly driven by agricultural products which are export oriented.

The service industry continued to expand following the level of performance shown in the two previous years by registering a steady growth of 2.9 per cent  with a total value added at constant, 2006 prices of VT 42,916 million compared to VT 41,711 million in 2016 (see Tables 2 & 5).

The components that contributed positively to overall services were retail trade and other wholesale trade which recorded a positive growth of 3.4 per cent each, followed by wholesale retail trade and repair of motor vehicle  at 2.6 per cent, accommodation and food services at 3 per cent, information and communication at 13.5 per cent, professional, scientific and technical services also grew at 2.6 per cent, transport at 1.8 per cent, real estate at 1.7 per cent, public administration or government services at 1.1 per cent and  professional, scientific, technical and administrative services.

The components that contributed negatively to services are finance and insurance which decline by 2.8 per cent.    

GDP at current prices was estimated at VT 94,887 million in 2017, registering nominal growth of 8.8 per cent.

The GDP per capita represent the estimate value of all goods and services produced in the economy per person in Vanuatu stood at Vatu 238,382 in real terms in 2017. It grew by 2 per cent in 2017. 

     

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