Vanuatu’s good recent growth performance and prospects

Abstract

Rod Duncan’s article in the last Pacific Economic Bulletin is the latest in a string to denigrate the performance of the Vanuatu economy. Duncan (2008), Hughes and Sodhi (2006, 2008) and Henckel (2006) all take a similar tack. Vanuatu has stabilised its economy but this is only necessary and not sufficient for economic growth, which has done poorly in the past and which will (Duncan, Hughes and Sodhi) or might (Henckel) stagnate in the future. Hughes and Sodhi and Henckel place primary blame for poor growth on missing land markets. Duncan blames the high cost of infrastructure. This line is becoming increasingly untenable.