Vanuatu - Domestic policy

Natapei, who pledged he would bring transparency to the government of Vanuatu, inherited a government plagued by financial troubles and tainted by the questionable business deals of his predecessor, who had used money provided by a Thai company doing business in Vanuatu to pay back wages due to his police force. The police were at the forefront of another controversy in 2002, when more than twenty officers were charged with mutiny after taking part in the arrest of controversial police commissioner Maile Apisai in August. In September Natapei called for an end to feuding between the country's police and paramilitary forces.

As Vanuatu is a nation with a poor growth rate despite its plentiful natural resources, the aid strategy for Vanuatu developed by the Asian Development Bank (ADB) in 2001 relied upon investment in social and infrastructure programs as a means of reducing poverty. The ADB also pledged US $330,000 in technical assistance to support Vanuatu's efforts to reform its legal sector.

On taking office, Natapei pledged his commitment to improving health service delivery in the remote rural areas. In June 2001, he formalized plans with Australia under which Australia would contribute A $700,000 ( US $368,130) to Vanuatu, with a portion of this sum earmarked for the purchase of basic medical supplies, buildings, and maintenance materials for remote island dispensaries and clinics. The remainder would go toward the purchase of general medical supplies for the nation's Central Medical Stores. At the end of September 2002, Natapei announced that the first case of HIV/AIDS was officially recorded in Vanuatu.

In 2001, an agreement between the Vanuatu Commodities Marketing Board and Coconut Oil Production Vanuatu Limited determined that copra would be processed in Vanuatu rather than exported. Coconut Oil Production Vanuatu would process the copra using coconut oil, an economical and environmentally friendly alternative to imported diesel oil. Further goals of the agreement included increased production of oil and coco meal, and the establishment of a refinery on site.

Natapei's government has shown awareness of the relationship between the health of the environment and the health of the nation's economy. A report issued in 2001 spotlighted the use and misuse of the nation's national resources, warning of the over harvesting of clams and turtles. Programs were set up to encourage citizens to protect those resources so critical to the nation, and to serve as volunteer protective monitors. The following year, Natapei declared 2002 the "Year of Reforestation."

In February 2003, Natapei traveled to Pentecost Island to perform a peace ceremony aimed at ending two years of conflict between the chiefs there. The conflict stemmed from an incident in 2001 when police were accused of mistreating the Pentecost chiefs, to which the chiefs responded by banning all law enforcement officials from the island. The chiefs imposed a fine of cash and pigs before the police would be allowed to return. Ongoing violence and unrest were showing no signs of abating before Natapei's visit. Natapei paid the fine, apologized formally to the chiefs, and issued an appeal for peace. The chiefs expressed appreciation to Natapei for his efforts and stated their commitment to fostering peace again on the island.