Vanuatu has received 1.1 million US dollars from the American Government sponsored Millennium Challenge Fund, for its infrastructure projects which begin next year.
The money is the first installment of a 69 million US dollar compact of agreement signed between the Vanuatu government and the Millennium Challenge Corporation.
Vanuatu is the only country in the Pacific which was eligible for the fund.
The director of the Millennium Challenge Corporation, Charles Sethness says the Funds will be used to build infrastructure including airports, wharves, roads and warehouses.
Mr Sethness says the overall objective of the project is to raise the living standard of 80 per cent of the people who live in rural areas.