Vanuatu's President Tallis Obed Moses says newly set up foreign companies must employ ni-Vanuatu before hiring overseas workers.
The president said expatriate professionals can only be hired for tasks which locals have no expertise in.
The president called on the Government to revisit the Employment Act to strengthen the relevant provisions.
He also said the government must ensure the existing list of commercial businesses restricted to ni-Vanuatu is respected.
Our correspondent said the president's comments came after a naturalised Chinese investor was given permission to operate a kava bar in Port Vila.
The successful application, approved by the mayor of Port Vila, had sparked anger on social media.