Vanuatu's opposition leader says the government has conceded the country's interests too readily to satisfy international requirements over its tax haven status.
Prime Minister of Vanuatu Charlot Salwai. Photo: ITU Pictures
Parliament has passed various bills as part of reforms aimed at removing Vanuatu from the money laundering grey list of the OECD's Financial Action Task Force.
Ishmael Kalsakau said the opposition was concerned that each time Vanuatu changes its laws to meet the Task Force's requirements, the goal posts are shifted.
He said even the prime minister Charlot Salwai admited that it remained to be seen whether implementation of new reforms meets the Task Force's requirements.
"Given there is no light at the end of the tunnel, we would need to be satisfied first that what we are doing will, once and for all, get us off the grey list, and secondly is done in a way that does not corrode upon questions of sovereignty and integrity."
The Financial Action Task Force's grey list consists of countries it regarded as having inadequate mechanisms for combating money laundering and terrorism financing.
Mr Kalsakau said the opposition also wanted Vanuatu to be removed from the list.
"We would like to know what needs to be done to get us off the grey list, get all of that together, and once all of that's together then we can legislate the entire requirements that are necessary."
The prime minister said that the whole country would face serious financial and economic impacts if parliament didn't pass legislation such as the Financial Institution Bill and amendments to the Mutual Assistance In Criminal Matters Act.
Charlot Salwai said the legislative reforms would "put back confidence because we depend on global economy".
According to Mr Kalsakau, Vanuatu's offshore finance sector was still beneficial to the country, and had a good track record.
"We've just been through a category 5 cyclone, and we're still recovering from that. There needs to be an understanding of the Vanuatu setting," he said.
"We need to look at the legislation in context to the environment of all of the countries. We don't have to deal with issues of terrorism. Our track record shows that there has only been one or two cases of money laundering of proceeds of crime.
"Overall we have a justice system that works. We've had issues of tax evasion through Australia traverse our legal system, and warrants have been issued and the governments from where the applications have been made have been largely successful in combating those sorts of crime in Vanuatu."