Asia Pacific News
LAST UPDATE: July 24, 2025
IMF: Vanuatu’s Govt Must Spend on People, Not on Non‑Urgent Projects
The IMF emphasized that Vanuatu should focus government spending on vulnerable citizens and essential infrastructure rather than non-urgent projects, warning that elevated deficits could threaten debt sustainability amid post-earthquake and pandemic recovery efforts.
Insight
This recommendation underscores the fragile fiscal situation—redirecting funds to social safety nets and boosting revenue will be critical to bolstering resilience and avoiding long-term debt strain.
Prices in Vanuatu May Rise Again, Warns IMF
The IMF cautioned that inflation in Vanuatu—which is currently within target—may rebound due to global supply chain disruptions, local shortages, and slow tourism recovery.
Insight
The warning highlights the need for strong fiscal frameworks and supply-side measures: inflation could undermine purchasing power and hamper recovery if not carefully managed.
RBI Injects $5.8 Billion Cash as Borrowing Costs Top Policy Rate
The Reserve Bank of India conducted a ₹500 billion (~US$5.8 billion) repo auction after overnight rates rose above the 5.5% policy rate, aiming to stabilize short-term borrowing costs.
Insight
RBI’s move signals heightened liquidity pressures and evolving monetary operations. The central bank appears to be preparing for a possible adjustment in policy stance or liquidity framework.
Australia risks becoming a ‘welfare state’, study warns
A report warns that, without reforms to boost productivity and control spending, Australia’s growing social welfare commitments could push it toward a welfare-state model.
Insight
The study highlights the need for structural reforms: enhancing efficiency and limiting unchecked welfare growth are seen as essential to preserving fiscal health.
Australia makes second $525 million AUKUS payment amid US review
Australia made a second A$800 million (US$525 million) payment to the U.S. under the AUKUS submarine pact, confirming commitment despite a formal U.S. review.
Insight
The payment signals unwavering Australian resolve to strengthen Indo-Pacific defense capability, even as U.S. scrutiny may reshape some dynamics of the trilateral deal.
Suspended Thai PM Gets More Time to File Defense in Ethics Case
Thailand’s Constitutional Court extended suspended PM Paetongtarn Shinawatra’s deadline to July 31 to submit her defense in an ethics case involving leaked diplomatic phone calls.
Insight
The extension highlights the complex balance between judicial caution and political stakes. Her response could shape Thailand’s political stability and future governance.
Pacific nation ponders taking asylum seekers from US
Palau is considering a proposal from the U.S. to host third-country asylum seekers. The decision is pending approval by its Council of Chiefs, with Palau not a UN Refugee Convention signatory.
Insight
This reflects broader U.S. migration strategy to offshore processing. It also highlights the geopolitical tightrope small nations face when balancing autonomy against major-power influence.
