Starting a Business in Vanuatu: Practical Guide and Tips

Published on September 30, 2025 and written by Cyril Jarnias

In a world where innovation and entrepreneurship drive the global economy, Vanuatu is emerging as a surprising destination for startups seeking an environment conducive to their growth. This tropical archipelago in the South Pacific, known for its white sand beaches and crystal-clear waters, is now positioning itself as a potential hub for bold entrepreneurs. But what makes Vanuatu so attractive for startups? What are the advantages and challenges of launching a business in this small island paradise? Let’s dive into the unique opportunities Vanuatu offers visionary entrepreneurs.

Vanuatu: An Unexpected Oasis for Innovative Startups

Vanuatu, an island nation composed of 83 islands, isn’t just a paradise for tourists seeking escape. This small South Pacific country is increasingly positioning itself as an attractive destination for entrepreneurs worldwide. With a growing economy and a government eager to attract foreign investment, Vanuatu offers fertile ground for innovative startups.

One of Vanuatu’s main assets lies in its advantageous tax policy. The country levies no income tax, no corporate tax, and no capital gains tax. This light taxation allows startups to reinvest a larger portion of their profits into their growth, a significant advantage for young companies in the development phase.

Furthermore, Vanuatu has implemented simplified procedures for business creation. The company registration process can be completed in just a few days, which strongly contrasts with the often lengthy and complex administrative procedures in many other countries. This administrative efficiency is a major asset for entrepreneurs who want to launch their business quickly.

The Vanuatu government has also invested in developing digital infrastructure. The country now benefits from high-speed internet connection thanks to a submarine cable linking the archipelago to Fiji. This increased connectivity opens new perspectives for tech startups, allowing them to stay connected to the global market while enjoying the exceptional living environment Vanuatu offers.

Finally, the quality of life in Vanuatu is a strong argument for attracting talent. The country is regularly ranked among the happiest nations in the world, offering a perfect balance between professional and personal life. This idyllic living environment can be a major asset for startups looking to recruit and retain talented employees.

Ideal Legal Structures for Your Startup in Vanuatu

When it comes to creating a startup in Vanuatu, choosing the legal structure is crucial. The country offers several options, each with its specific advantages. The two most popular legal forms for startups in Vanuatu are the International Company and the Exempt Company.

International Company

The International Company is the structure most commonly used by foreign entrepreneurs in Vanuatu. It offers maximum flexibility and considerable tax benefits. The main characteristics of this structure are:

• Total exemption from taxes on profits made outside Vanuatu
• Possibility of having a single shareholder and a single director
• No obligation to hold annual general meetings
• Enhanced confidentiality, with shareholder and director names not accessible to the public

This structure is particularly suitable for startups planning to operate primarily internationally or in the e-commerce field.

Exempt Company

The Exempt Company is another interesting option for startups in Vanuatu. It offers benefits similar to the International Company, but with some notable differences:

• Tax exemption on all income, whether generated in Vanuatu or abroad
• Requirement to have at least one resident director in Vanuatu
• Necessity to hold an annual general meeting
• Greater transparency, with the obligation to file annual accounts

This structure may be more appropriate for startups planning to have a significant physical presence in Vanuatu or wanting to benefit from an image of greater transparency.

Regardless of the chosen structure, it’s important to note that Vanuatu has strengthened its regulations regarding anti-money laundering and counter-terrorism financing. Startups must therefore ensure compliance with these international standards, which may involve stricter due diligence procedures during company formation.

Additionally, Vanuatu now requires companies to have real “economic substance” in the country. This means startups must demonstrate physical presence and concrete activities in Vanuatu, rather than being mere “mailbox” companies.

Funding Your Entrepreneurial Dream in Vanuatu: Strategies and Opportunities

Funding is often the lifeblood for startups, and Vanuatu is no exception to this rule. However, this small Pacific country offers unique opportunities and innovative strategies for entrepreneurs seeking funds. Here’s an overview of the main funding options available for startups in Vanuatu.

Local Angel Investors

Vanuatu has seen the emergence of a growing community of angel investors in recent years. These wealthy individuals, often successful entrepreneurs or expatriates, are willing to invest in innovative projects. They bring not only funds but also their expertise and network, which can be invaluable for a young startup.

• Have a solid and well-documented business plan
• Demonstrate thorough understanding of the local and regional market
• Present a competent and complementary team
• Show how your startup can contribute to Vanuatu’s economic development

Government Programs and Grants

The Vanuatu government, aware of the importance of startups for the country’s economy, has implemented several initiatives to support young businesses. The “Vanuatu National Sustainable Development Plan” includes specific measures to encourage entrepreneurship and innovation.

• The “Vanuatu SME Finance Facility,” a preferential loan program for small and medium-sized enterprises
• Grants for projects aligned with the country’s sustainable development goals
• Tax incentives for startups in priority sectors like green technologies or sustainable agriculture

Crowdfunding and Online Platforms

Although crowdfunding is not yet as developed in Vanuatu as in other parts of the world, local startups can leverage international platforms to raise funds. Sites like Kickstarter or Indiegogo can be particularly effective for projects with a social or environmental dimension, which often resonate with an international audience.

Strategic Partnerships

A funding strategy often overlooked but potentially very effective in Vanuatu is strategic partnership. By partnering with established companies, local or international, startups can access financial resources, as well as infrastructure and markets.

• A tech startup could partner with a local telecom operator to develop and deploy new solutions
• An ecotourism business could collaborate with international hotel chains to fund and promote unique experiences in Vanuatu

Regional Investment Funds

The South Pacific is increasingly attracting attention from regional and international investment funds. Funds like the “Pacific Islands Investment Forum” or “Pacific Rise” are specifically dedicated to supporting innovative businesses in the region. These funds often seek startups with the potential to solve specific problems facing Pacific islands, such as climate change adaptation or access to renewable energy.

International Financial Institutions

Finally, startups in Vanuatu can also turn to international financial institutions. The World Bank and the Asian Development Bank have specific programs to support entrepreneurship in small island states. These programs often offer a combination of funding, technical assistance, and mentoring.

Challenges and Opportunities: Navigating Vanuatu’s Startup Ecosystem

Launching a startup in Vanuatu offers unique opportunities but also involves specific challenges. Understanding these issues is crucial for any entrepreneur wanting to succeed in this evolving island environment.

Challenges to Overcome

1. Geographic isolation: Vanuatu, located in the heart of the South Pacific, may seem isolated from major global economic centers. This distance can complicate access to international markets and supply chains.

2. Limited local market size: With a population of about 300,000, Vanuatu’s domestic market is relatively small. Startups often need to think internationally from their inception to ensure growth.

3. Developing infrastructure: Although the country has made significant progress, some infrastructure, particularly in energy and transportation, may still present limitations for certain types of businesses.

4. Shortage of skilled labor: Finding local talent with specific skills, particularly in technological fields, can prove difficult.

Opportunities to Seize

1. A blank slate for innovation: Vanuatu offers fertile ground for innovative solutions, particularly in areas like renewable energy, sustainable agriculture, or technologies adapted to small islands.

2. A full-scale laboratory: Vanuatu’s size and relative isolation make it an excellent testing ground for new products or services before larger-scale deployment.

3. Access to regional markets: Vanuatu can serve as a springboard to access broader South Pacific and Asia-Pacific markets.

4. An environment conducive to creativity: Vanuatu’s exceptional living environment can stimulate creativity and innovation, attracting talent from around the world seeking work-life balance.

Strategies for Success

To successfully navigate this unique ecosystem, startups in Vanuatu can adopt several strategies:

• Think global, act local: Develop solutions that address Vanuatu’s specific needs while having global application potential.
• Focus on sustainability: Align startup goals with the country’s sustainable development challenges, which can open doors in terms of funding and government support.
• Cultivate partnerships: Collaborate with local businesses, NGOs, and academic institutions to overcome resource shortages and access valuable local knowledge.
• Invest in training: Contribute to developing local skills by investing in training and mentoring, creating a talent pool for the future.
• Leverage technology: Use digital tools to overcome challenges related to geographic isolation and access global markets and resources.

The Future of Startups in Vanuatu

The Vanuatu government recently announced its ambition to make the country an innovation hub for the South Pacific by 2030. This vision is accompanied by plans to improve digital infrastructure, further simplify administrative procedures for businesses, and create incubators and accelerators dedicated to startups.

Additionally, the country is actively exploring opportunities offered by new technologies like blockchain and artificial intelligence. Vanuatu was even one of the first countries to consider creating a national digital currency, demonstrating its openness to financial innovation.

These initiatives promise to create an even more favorable environment for startups in the coming years, making Vanuatu an increasingly attractive destination for visionary entrepreneurs.

Conclusion: Vanuatu, Your Next Entrepreneurial Destination?

Vanuatu is emerging as a surprising but promising destination for bold entrepreneurs seeking a unique environment to launch their startup. This small Pacific archipelago offers a rare blend of tax advantages, exceptional quality of life, and innovation opportunities that make it fertile ground for novel ideas and ambitious projects.

Vanuatu’s assets for startups are numerous:

• An extremely favorable tax regime, with no corporate or income taxes
• Simplified administrative procedures for business creation
• An idyllic living environment conducive to creativity and attracting international talent
• A government committed to developing the entrepreneurial ecosystem
• Unique opportunities in sectors like green technologies, sustainable agriculture, or responsible tourism

Admittedly, launching a startup in Vanuatu also has its challenges, particularly in terms of geographic isolation and limited local market size. However, these challenges can be transformed into opportunities by creative and visionary entrepreneurs. Vanuatu offers an ideal testing ground to refine innovative concepts before deploying them regionally or globally.

Moreover, the government’s commitment to making Vanuatu an innovation hub for the South Pacific by 2030 promises an even brighter future for the country’s startup ecosystem. With planned investments in digital infrastructure and the creation of incubators and accelerators, Vanuatu is positioning itself as a destination of choice for future entrepreneurs.

Ultimately, Vanuatu offers a rare opportunity: that of building an innovative business in a paradise setting, while benefiting from significant tax and regulatory advantages. For entrepreneurs ready to take on the challenge of innovation in a unique island context, Vanuatu might well be the next frontier of global entrepreneurship.