Vanuatu Tourism Value Chain Study

The Challenge

Vanuatu’s tourism sector is a major contributor to national GDP and employment, yet it faced a series of compounding shocks, from COVID-19 border closures to cyclones and infrastructure damage, that severely disrupted the industry. At a time when governments and donors were making critical decisions about recovery investments, there was limited up-to-date data on how tourism benefits were distributed across regions, communities, and sectors. The Market Development Facility (MDF), funded by DFAT and implemented by Palladium, recognised the need for a clearer picture of the sector’s structure, performance, and future potential to support inclusive economic growth. In particular, there was a pressing need to understand local supply chains, business viability, workforce dynamics, and the regional spread of tourism activity.

The Action

Polis Partners was engaged to lead a detailed tourism value chain study, piloted in Shefa Province. The project mapped key components of the tourism economy, including accommodation, transport, tours, food supply, and cultural services, and identified where value was created, retained, or lost. The study pinpointed barriers to local enterprise growth, areas of economic leakage, and opportunities for targeted policy support. Extensive consultations were held with local businesses, government agencies, and industry associations. A scalable survey and analytical framework was developed to enable national rollout and long-term sector monitoring.

The Results

The study delivered a robust, policy-ready evidence base for MDF and the Vanuatu Government to guide future tourism investment. It revealed where local value could be strengthened and where interventions, such as local supply chain integration, business development, and workforce training, could drive more inclusive growth. The methodology has since been adopted by other Pacific nations exploring tourism sector revitalisation and sustainable economic development.