Australia and Vanuatu are days away from completing negotiations on the Nakamal Agreement. This nascent strategic pact will do even more to deepen their bilateral relations. To that end, next month we will begin to formalize this agreement. Australia will give around half a billion dollars to Vanuatu over the next 10 years, with an emphasis on security, fiscal support and climate change resilience.
The Nakamal Agreement follows more than a year of tough negotiations between the two countries, especially about something as seemingly nicety as visa-free entry to Vanuatu. Prime Minister Jotham Napat of Vanuatu signaled unequivocally that he could not support the agreement. He further insisted that Australia guarantee visa-free travel for his nation’s citizens. This stipulation emphasizes the need for mobility and collaboration between the two countries.
Within the Indo-Pacific, Australia has announced plans to provide at least $100 million in security assistance. On top of that, they’ll deliver $55 million in supportive budgetary actions. Additionally, over $110 million will be distributed to assist Vanuatu in fighting the effects of climate change. The deal lays the groundwork for Australia to fund the building of two major data centers in Port Vila and Santo. This new effort is being made with an investment of approximately $120 million.
Strategic Importance of the Nakamal Agreement
Upon coming into effect, the Nakamal Agreement would supersede the current 2022 security treaty between Australia and Vanuatu. Under this prior pact, Australia was designated Vanuatu’s primary security partner. Australia sees this new pact as a strategic effort to increase Vanuatu’s economic development. Simultaneously, it seeks to increase its own footprint and clout in the region as interest from China rapidly expands.
A spokesperson for Foreign Minister Penny Wong said it was continuing to make progress, with negotiations still underway. “Our partnership between Vanuatu and Australia remains strong, especially as Vanuatu continues its recovery efforts,” they stated. The spokesperson emphasized that while significant strides have been made, both sides still have work to do before finalizing the agreement.
High level counterparts from each country are preparing—indeed, they are ready—for this spring’s signing ceremony. Other high-profile attendees are Foreign Minister Penny Wong, Defence Minister Richard Marles and Pacific Minister Pat Conroy. Honorary Prime Minister Jotham Napat and many other Vanuatu leaders would meet on the island of Tanna. In tandem, they will display their dedication to this new and important strategic alliance.
Implications for Regional Stability
The ramifications of the Nakamal Agreement go further than monetary aid. By enhancing security cooperation and development aid, Australia aims to bolster stability in Vanuatu, which is crucial for regional security in the South Pacific. Moreover, even as Pan-Asianism becomes a popular idea, people remain exceedingly concerned about China’s rising power in the region. They hope this pact will provide a bulwark against that tide.
Vanuatu’s Prime Minister Napat has said the deal is a “win-win” situation for both countries. This feeling, at least in part, highlights the shared benefits expected from better collaboration and resource investment. In addition, negotiations this past spring on visa-free travel show an interest on both sides to deepen their relationship.
In her remarks, Minister Wong emphasized the significance of the recent progress. As she put it, “Australia is open to ambitious agreements that advance the shared prosperity and security of our region, such as those shown through our partnerships in the Pacific. This announcement is emblematic of Australia’s wider efforts to increase connections with Pacific Island countries as a means to enhance peace, security, and economic prosperity.
Future Prospects
Next month, we hope to see the formal signing of the Nakamal Agreement. This comes after the expected approval of Vanuatu’s Council of Ministers. This endorsement will be a game-changer in Australia’s relationship with Vanuatu. It shows a firm pledge to advance broader collaboration on multiple fronts.
Australia and Vanuatu have the opportunity to deepen their bilateral friendship. Together, both nations will address issues such as climate change and emerging regional security dynamics. The success or lack thereof of this agreement will set the precedent for what is possible in future agreements between Australia and its Pacific partners.
