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15-08-2025
CANBERRA/ PORT VILA: Australia and Vanuatu have agreed to a 10-year deal, aimed at strengthening security and economic ties, worth AU$500m ($328m; £241m).
The so-called Nakamal agreement, the result of months of negotiations will transform Australia’s relationship with its Pacific neighbor, leaders from both countries said on Wednesday.
“We are family,” Australia’s deputy Prime Minister Richard Marles said, adding, “Our future is very much bound together”. Vanuatu’s leader Jotham Napat described the deal as “win-win situation” for both nations.
The deal, to be officially signed in September, comes as Australia tries to grow its influence in the region, to counter China’s increased spending and power.
While the Australian government did not provide further details of the deal, the Australian Broadcasting Corporation (ABC) reports it will provide funds to build two large data centres in the capital, Port Vila, and Vanuatu’s largest island, Santo.
Millions will also be poured into helping the low-lying island to deal with the impacts of climate change, as well as building up its security.
In earlier stages of the negotiations, visa-free travel for citizens of Vanuatu was also discussed and considered a key part of the deal. However, Napat told the media on Wednesday that this issue would be covered in a “subsidiary” agreement, yet to be confirmed.
It is unclear what, if any, commitments Vanuatu has given Australia as part of the deal.
A similar agreement fell through in 2022, after Vanuatu’s previous prime minister pulled out at the last minute over security concerns, according to the ABC.
At a press conference on the side of a volcano on Tanna Island, one of 80 plus in the Vanuatu archipelago, Marles emphasized the “shared destiny” of the two countries.
“(The deal) acknowledges that as neighbors, we have a shared security environment and a commitment to each other,” he said.
Australia’s Foreign Minister added that the deal was about the long-term future.
“The most important thing (about the deal) is where we will be (in) three and five and ten years,” Penny Wong said.
Vanuatu’s Prime Minister Napat said the agreement will bring “a lot of great benefits between the two countries, whether it be the security agreement, economic transformation, with some specific focus on the mobile labour mobility and financial support”. This week’s Vanuatu deal comes after Australia signed similar pacts with several of its other Pacific neighbors in recent months.
Canberra struck a new AU$190m security deal with the Solomon Islands last December, with similar agreements also in place with Tuvalu and Papua New Guinea.
A $500 million deal between the two countries was given the green light to be formally signed off following talks in Vanuatu on Wednesday.
The deal, known as the Nakamal Agreement, would help address infrastructure and economic development in the Pacific as well as resilience to climate change.
Foreign Minister Penny Wong and Defence Minister Richard Marles held negotiations with Vanuatu leaders, giving the go-ahead to the agreement in a signing ceremony on the edge of an active volcano.
It is expected Prime Minister Anthony Albanese and his Vanuatuan counterpart Jotham Napat will formally ratify the agreement in September.
Marles said there had been a significant breakthrough in negotiations on the agreement. (Int’l Monitoring Desk)
