Australia and Vanuatu have reached a 10-year, A$500m ($328m; £241m) agreement designed to boost security and economic ties.
Known as the Nakamal agreement, it follows months of talks and is expected to be signed in September. Leaders from both nations say the deal will reshape their relationship.
According to the Australian Broadcasting Corporation, the package will fund construction of two major data centres in Port Vila and Santo, invest in climate change adaptation for the low-lying islands, and strengthen security infrastructure.
Discussions on visa-free travel for Vanuatu citizens are ongoing and may be finalised in a separate agreement.
Details of Vanuatu’s commitments to Australia have not been disclosed. A similar pact was abandoned in 2022 when Vanuatu’s then-prime minister withdrew over security concerns.
Announcing the deal on Tanna island, Australia’s deputy prime minister Richard Marles said the two countries share a security environment and a long-term commitment.
Foreign Minister Penny Wong said the focus is on future outcomes over the next decade.
Vanuatu’s prime minister Jotham Napat said the agreement will deliver benefits in security cooperation, economic growth, labour mobility, and financial support.
The deal is part of Australia’s broader push to strengthen Pacific partnerships, following recent security pacts with the Solomon Islands, Tuvalu, and Papua New Guinea, amid growing Chinese influencein the region.