The majority of Vanuatu's population are indigenous Melanesian, known locally as ni-Vanuatu, though there are also Chinese, European and Vietnamese minorities, as well as smaller groups of other indigenous peoples, such as Futunans, i-Kiribati and Wallisians. The country has undergone a series of political crises since the 1990s, resulting in numerous changes in leadership. The year 2014 also saw a change in key leadership positions in the country, with then Prime Minister Moana Carcasses Kalosil defeated by Joe Natuman in a no-confidence vote on 15 May 2014. Presidential elections were held in September, resulting in the election of Baldwin Lonsdale.

The year 2014 saw important changes to Vanuatu's legislation on indigenous land rights. The new laws alter the Constitution to include recognition of customary institutions and establish a role for the Malvatumauri (National Council of Chiefs) in advising parliament on changes to land law, as well as to strengthen the control of customary institutions while reducing the power of the minister of lands over customary land. It is hoped that this new legislation will prevent leases on customary land being signed off by the minister without the consent of the communities – a recurring issue since the country gained independence in 1980.

In terms of urbanization, Vanuatu has one of the region's highest growth rates, and it is projected that over half of the Vanuatu population will be based in urban centres by 2050. This is particularly the case in Port Vila, Vanuatu's largest city, where ni-Vanuatu face limited land availability – a situation that has been exacerbated by the development of tourism-related facilities and exclusive residential housing, leased on what was regarded until recently as inalienable indigenous land. As much as 80 per cent of the coastland on Etafe Island, where Port Vila is located, has been leased out. As a result, large tracts of territory have been walled off, restricting access to local beaches and marine resources. Some villages in peri-urban areas are now obstructed by commercial resorts and other developments that have blocked off swathes of community land from public use. The impacts of this are especially acute for ni-Vanuatu inhabitants, who have a particularly close connection to the land – an essential element in their traditional culture and local livelihoods.

Although urban areas tend to have better services than rural areas, poverty rates are highest in urban communities. A recent UNICEF study found that one-third of children in Port Vila live in poverty – a rate nearly 20 per cent higher than the national average. Living conditions for ni-Vanuatu in poorer settlements are also deteriorating as a consequence of overcrowding and limited services or infrastructure. As a result, Port Vila's poverty levels are 18 per cent, compared to 10 per cent in rural areas. Furthermore, lack of access to safe water, sanitation or waste disposal facilities are contributing to deteriorating health outcomes among urban ni-Vanuatu. Many urban disenfranchised ni-Vanuatu women are particularly affected by poverty and excluded from paid employment.

Vanuatu has been ranked by UN sources as the country with the highest risk of experiencing a natural disaster in the world. March 2015 saw one of the worst disasters in its history when Cyclone Pam hit the island, displacing at least 3,300 people and affecting more than half of its population. In Vanuatu, as with other Pacific islands, large urban areas are especially vulnerable due to the dense concentration of their populations in disaster-prone coastal locations, particularly the poorest and most marginalized. In Port Vila, the cyclone destroyed makeshift housing and weakened already limited basic services, leaving many informal settlements in even deeper poverty. However, given the scale of the disaster, the death toll remained relatively low, with 11 confirmed fatalities in the whole of Vanuatu. While modern communications and early warning systems helped reduce the death toll, the particular characteristics of the indigenous communal houses – known as nakamals – also proved critical. This was due to their construction with lightweight materials such as bamboo, as well as the use of traditional design measures that strengthen their resilience to storms.

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