The Australian Government has announced that its new aid strategy for Vanuatu will have a focus on improving governance.
Foreign Minister, Alexander Downer, says the aid package was concluded after consultations last week.
He says in seeking to improve governance the strategy will help develop more accountable police and legal systems, public sector reforms and financial accountability.
Money has been set aside to lift productive capacity in agriculture and tourism with an emphasis on providing job opportunities for young people.
The new strategy will also help to extend basic services such as health and education services, particularly in isolated rural areas and squatter settlements.
Another feature of the strategy is its support for the links between the Council of Chiefs and the just opened Australian Centre for Peace and Conflict Studies at the University of Queensland.
The Centre will aim to increase the capacity of the chiefs to deal with conflict and more effectively represent their people in economic and social development issues.