VTSSP(Land Transport)

Implementation Strategy
Priority Outcome 3: Improved Infrastructure
Vanuatu-Australia Partnership for Development
Priority Outcome 3: Improved Infrastructure
Joint Commitments
The Partnership will support the development of Vanuatu’s infrastructure, recognising
its fundamental role in the provision of economic opportunities and in the delivery of
For road transport infrastructure, under Phase 1 (2009-2012) of the Vanuatu
Transport Sector Support Program (VTSSP), Vanuatu and Australia will:
• Rehabilitate and maintain 191 km of priority rural roads on Tanna, Malekula
and Ambae to improve access to markets and services
• Generate up to160,000 work-days of employment by ensuring that the private
sector and local communities become key providers of road maintenance
services creating jobs and income in rural areas
• Establish sustainable and affordable institutional arrangements for road
• Strengthen the management of public finances within the transport sector to
ensure that funding is used efficiently and effectively
• Complete the design for Phase 2 of the VTSSP which will set in place a longterm
program of Australian support for transport infrastructure.
For maritime transport infrastructure, Vanuatu and Australia will prepare a
feasibility study on the investment and management improvements needed to enhance
the capacity and operating efficiency of Port Vila wharf.
For aviation, Vanuatu and Australia will assess reform and restructuring options to
ensure that Air Vanuatu is able to operate on a sustainable basis over the long-term.
For telecommunications and power, the existing reforms and investments being
implemented through the Governance for Growth (GfG) program will remain a
priority for Vanuatu and Australia. The aim of these activities is to improve the
access to and affordability of telecommunications and power throughout Vanuatu,
• Achieving at least 90 percent mobile phone population coverage by 2010.
• Introducing competition for internet services by 2009.
• Completing a review of the power tariff by 2009.
• Increasing access to off-grid power by 25 percent by 2012.
Vanuatu-Australia Partnership for Development
Vanuatu and Australia will adopt the following targets with respect to activities in
support of infrastructure development.
Activity Targets Timeframe
1. Road Maintenance • VTSSP Phase 1 Implemented Effectively
• VTSSP Phase 2 Design Completed
Jun. 2012
Dec. 2011
a. Rehabilitate and
maintain priority rural
• 191 km of rural roads rehabilitated and
maintained on Tanna, Malekula and Ambae
Jun. 2012
b. Generate local
employment and
• Up to 160,000 work-days generated for local
communities and the private sector through
road maintenance activities on Tanna, Malekula
and Ambae
• Community groups and small-scale contractors
have the required skills and equipment to
undertake maintenance work
Jun. 2012
Jun. 2010
c. Establish sustainable
and affordable
• Capacity building program in place and is
strengthening the skills of the Public Works
Department (PWD)
• Strengthened planning and supervision of road
maintenance programs by PWD
• Local communities and the private sector
become a key means to deliver road
maintenance services in provinces targeted by
Nov. 2009
Jun. 2012
Jun. 2012
d. Strengthen the
management of public
• Funding delivered effectively and efficiently
using Vanuatu Government systems
• Financial management systems, procedures and
skills within the Ministry of Infrastructure and
Public Utilities strengthened
• Community-groups and small-scale contractors
paid in a timely manner
Nov. 2009
Jun. 2010
Jun. 2010
2. Maritime • Feasibility study completed outlining options to
improve the efficiency of Port Vila wharf
Sep. 2009
3. Aviation • Assess Air Vanuatu’s financial position and
identify possible reform and restructuring
Sep. 2009
4. Telecomms • Universal Access Policy finalised to extend
priority telecommunication services to areas
which are not commercially viable
• New telecommunications legislation adopted.
• Competition for internet services
• Permanent independent and well-qualified
telecommunications regulator appointed
Jun. 2009
Jul. 2009
Sep. 2009
Sep. 2009
5. Power • Utilities Regulatory Authority completes
review of Vanuatu’s power tariff
• Luganville Concession re-tendered
• Rural electrification priorities identified and
implementation programs established
Dec. 2009
Dec. 2010
Jul. 2009
Vanuatu-Australia Partnership for Development
More detailed indicators for the targets above are contained within the VTSSP and
GfG performance frameworks and will be jointly assessed by Vanuatu and Australia
each year. Means of verification will include Vanuatu Government budget
documents, annual workplans and budgets, annual road condition surveys, baselines
and impact studies, site visits, financial reporting including external audit reports and
contract and procurement documentation.
Road Transport. Through the VTSSP, Vanuatu and Australia will commit the
following resources to support activities to develop road transport infrastructure.
Year Vanuatu
VUV million
Australia (VTSSP)
AUD million
2009 500 4.0
2010 500 4.4
2011 500 5.8
2012 500 3.1
Total 2,000 17.3
Vanuatu’s contribution represents a continuation of its existing commitment under the
Millennium Challenge Account (MCA) project and that their resources will be used
solely for the purpose of road maintenance activities.
Australia’s commitment represents a contribution made under the Pacific Region
Infrastructure Facility (PRIF) to the VTSSP.
Other Infrastructure Activities. Through the GfG program, Australia will provide
financing for analytical and design activities to develop reform and investment
programs for maritime and aviation transport. Existing programs in
telecommunications and power will continue. Available funding for these activities is
as follows.
Year Australia through GfG
AUD million
2009 9.9
2010 5.0
2011 4.6
2012 TBA
Preliminary Total 19.5
Where additional priority activities are agreed by Vanuatu and Australia under this
Partnership and additional financing is required – such as for the possible
implementation of reforms in maritime and aviation transport – Australia will
consider the scope to make additional funding available under the PRIF and other
mechanisms. The next phase of the GfG program will be designed during 2011 and
will result in funding decisions for 2012 and beyond.
Vanuatu-Australia Partnership for Development
Use of Vanuatu Government Systems
Consistent with the Paris Declaration on Aid Effectiveness and the Accra Agenda for
Action, strengthening the effectiveness of Vanuatu Government systems is a key
objective of Australia’s aid program to Vanuatu. Australia will seek to use and
strengthen Vanuatu Government systems in delivering support in the infrastructure
sector. Australia’s contribution to road maintenance will be delivered through the
budget of the Ministry of Infrastructure and Public Utilities (MIPU) and will include a
component of capacity building for public financial management.
To support these activities the Vanuatu Government will maintain its commitment to
achieve a high standard of public administration, including compliance with relevant
legal obligations under its Public Finance and Economic Management (PFEM) and
Government Contracts and Tenders (GCT) legislation.
Implementing Arrangements
Activities in support of infrastructure development will be undertaken through the
GfG program which is a joint initiative of the Vanuatu and Australian Governments.
The aim of GfG is to identify and remove obstacles to economic growth and service
delivery in Vanuatu.
Within the Vanuatu Government the key implementing agencies are the Prime
Minister’s Office, Ministry of Finance and Economic Management and Ministry of
Infrastructure and Public Utilities.
Within the Australian Government the key implementing agency is AusAID.
Donor Coordination
Vanuatu and Australia will promote coordination between development partners
working on infrastructure development. The main agencies currently involved in the
relevant sectors are:
• Road transport: United States (Millennium Challenge Corporation), New
Zealand (NZAID)
• Maritime: Japan (JICA), New Zealand (NZAID), Asian Development Bank
• Aviation: International Finance Corporation (IFC)
It is noted that the ADB, New Zealand (NZAID) and the World Bank are partners in
the PRIF and are working collaboratively to promote infrastructure development in
the Pacific.

Author: Administrator