The Minister for Finance and Economic Management, Johnny Koanapo said the government has a plan in place but it will require COM’s final endorsement.
Mr Koanapo also said that he will request COM to agree for another month of Extension for the ESP, so businesses that are eligible can continue to receive assistance.
“I thank the businesses who continue to work with the Government on this,” he said.
When asked what the plans are, the Minister said that COM will need to agree on a major comprehensive but sustainable policy framework to continue supporting the economic activities, for people in the rural areas.
The National Statistics Office confirmed that some 75% of the national population live in rural areas and rely heavily on subsistence farming.
Minister Koanapo said it’s logical to devote more resources to this group so they can support their livehood as well as the rural economy during these times.
While the employment stabilisation payments have served their purpose, the Government needs to find a more sustainable way to ensure that those from the hotel industry that are affected by COVID-19 are given opportunities through these packages to be upskilled in preparation for the time when the industry returns to normal. It is important to ensure farmers are given support as well so they can help to produce enough to feed the population. If the Government can buy food from farmers to feed its distressed population who are affected by COVID-19, cyclones and volcanic ash then everybody gains. This is the policy the government is working on, a statement from the minister stated.
The Minister is confident that the ESP policy will still have a reasonable amount of fund unspent and he wants these funding put to a more productive use, so that more people in the rural areas can benefit from.
The policy shift will see major diversion of the remaining funds towards sustainable production of major agriculture commodities for the productive sector. This will imply that the some of the fund will be diverted towards root crop cultivation and production on major commodities; of which Vanuatu has comparative advantage.
This expected diversion is anticipated to increase commodity production and at the same time, encourage employment in subsistence agriculture, pushing employment back to the rural community and also ensure that Vanuatu is able to feed its people.
Additionally, Minister Koanapo said that the government is having discussions with the Ministry of Tourism, Agriculture and the Ministry of Education to ensure refresher trainings as well as capacity building sessions are made available for those in the tourism and services sector.
Meanwhile the Ministry of Finance has confirmed that despite ongoing criticisms on social media regarding the Economic Stimulus Package payment rollouts, the policy implementation continues to take its shape with positive progress.
As of May 2, 2020 a total of 301 companies have received payments for March under the ESP package with slightly over 55% of these companies now receiving April and May payments.
Over 5,200 Employees have now received at least a payment of the ESP. Some VT450 million has already been committed for the ESP Package.
The Small and Medium Enterprise (SMEs) businesses will be receiving their first payment from Monday 6th of July 2020 onwards. It has taken quite some time to progress to this stage due to the required policy and payment guidelines, but these are now overcome. A total of over 1,400 applications have already been received and the ESP team at the Ministry of Finance will continue with the final verifications process and rolled out more payments from 6th of July onwards.
The Ministry of Finance also wishes to inform parents to seek further guidance from the Ministry of Education on roll out of the tuition fee subsidy.
As of 2nd of July 2020, some 43 schools who were qualified have received their subsidy payments. The amount paid depends on the total enrollments the school has. To date some 8,054 students have received a VT42,000 subsidy from the government to their schools’ approved bank account. The government has so far committed a total of VT337 million for the tuition fee subsidy.
The population at large has been advised by government to refrain from speculating unnecessary comments over the social media but to seek the right source of information from the Ministry of Finance and Economic Management, the Ministry of Education, the Vanuatu Chamber of Commerce, the Land Transport Authorities, the Handicraft associations and the Department of Labour.
The Ministry of Finance says it is working hard on the credit of 3 billion vatu to continue to support the businesses. Mechanisms are being put in place. The Government will do the announcements on this and also on the final COM decision on a more sustainable policy of stimulus in the days ahead.
The Ministry says it is following the COVID-19 developments very closely and says it knows it is still uncertain and therefore adjustments on policy is necessary to ensure a more sustainable way of helping the people of Vanuatu going forward.
Photo supplied Caption: Minister of Finance and Economic Management Johnny Koanapo