Highlights

The preliminary estimates for 2022 GDP recorded a positive growth of 5.2% following a drop of 1.6% in 2021. This bought real Value Added almost back up to its pre pandemic level. Note however that real GDP per capita has still not recovered to its 2020 level let alone its 2019 level.

Chart 2 Shows the decomposition of the 5.2% growth by industry. The two industries that continued to drag down growth in 2022 were Construction, where some large contractors seem to have wound down altogether and “Other wholesale trade” which was affected by a fall in exports of copra and cocoa and a reduction in the volume of petroleum product retailing driven by the very large price increases. In contrast, retail trade recovered rapidly in response to the recovery in tourism as did accommodation and food services. Information and communication (largely mobile phone use) continued to expand as did real estate (largely agents) and “other finance” (largely insurers). Net Taxes minus subsidies were boosted by a drop in subsidies.

Expenditure

1. HFCE = Household Final Consumption, GFCF= Gross Fixed Capital Formation, Gov = Government Final Consumption, Exp = Exports and Imp= Imports, GDP-E = HFCE+FFCF+GOC+(Exp-Imp) + consumption of Non-Profit Institutions serving Households (NPISH) but the last three are too small to show separately on the chart.

The expenditure measure of GDP did not grow quite as strongly in 2022 and the statistical discrepancy widened slightly though it is still at historically low levels. The construction element of Gross Fixed Capital Formation fell sharply and strong imports growth also pulled down GDP. However exports also grew strongly (reflecting the recovery in tourist arrivals which returned to 2020 levels) and Government Consumption and Household Consumption also grew if not by as much. 

Revisions

The Vanuatu Bureau of Statistics expects to make many methodological and data revisions in the publication covering 2023 which we plan to issue later this year. We have therefore decided to make no changes to published estimates for past years in this publication which therefore contains no revisions tables. 

Concepts and Definitions

GDP is equal to the value of all goods and services produced in the economy (i.e., output) less the value of all goods and services used in the production processes (i.e., intermediate consumption). This is the production side measure of GDP.

Market outputs consist of

1. Total value of goods and services sold at the economically significant prices
2. Total value of goods and services use in bartered
3. Total value of goods and services use for payment in-kind
4. Total value of products produced and added to the inventories of finish goods and work in progress.

Final Expenditure Approach – is the total final expenditure at purchaser’s prices less total import value at (f.o.b), in other words it is the total final use of domestically produce goods and services less input of imported goods and services.

a. Output

Total output, or total value added, is measured as final output from all businesses less intermediate inputs going into the production process. This is achieved by considering how each business or enterprise adds value to the inputs it receives, so that the output of the business is measured in terms of the value added by means of its production activities.

For a single enterprise, value added by production activity is measured as gross output less inputs from other businesses less inputs from abroad.

Summing up the value added by all enterprises, the domestic intermediate transactions between businesses partial portion of the input subsequently use in production process. For the total economy, value added from the production side is measured as gross output less inputs from abroad (imports).

b. Intermediate Inputs

Intermediate inputs are goods and services, other than fixed assets, used as inputs into the production process of an establishment that are produced elsewhere in the economy or are imported. They may be either transformed or used up by the production process. Land, labour, and capital are primary inputs and are not included among intermediate inputs.

c. Implicit Price Deflators (IPD’s)

It is the Current Vatu GDP divided by Constant Vatu GDP. IPDs therefore have current year’s weights, rather than being “base weighted” like the CPI. The IPDs are expressed as 2006=100. This ratio is used to account for the effects of inflation, by reflecting the change in the prices of the bundle of goods and services that make up the GDP as well as the changes to the bundle itself.

d. GDP per Capita

GDP per capita is commonly used as an indicator of changes in living standards within and between countries. It is an approximation of the value of goods and services produced per person, and it is equal to the country's GDP divided by the total number of people in the country. The total population used for the Vanuatu calculation is based on 2016 Mini Census and average annual growth.

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Next update release: 28th December 2024