News 15 Jun 2017
A new era of closer economic relations with the Pacific has dawned following the signing of the PACER Plus trade and development agreement in Tonga.
On June 14, representatives from Australia, New Zealand, Tonga, Niue, Nauru, Samoa, Solomon Islands, Kiribati, Tuvalu and Cook Islands were at Nuku'alofa to sign the deal, which has been hailed by proponents as a new kind of agreement that links development to trade to boost island economies.
Trade Minister, Hon. Todd McClay attended the signing and says it has been a landmark moment for the economic future of the Pacific.
“Pacer Plus will help sustainably develop the countries involved through trade and help raise the standard of living for their people,” Minister McClay says.
“A more resilient and prosperous Pacific is in all of our interests,” he adds.
In the short-term, Minister McClay says Pacific countries who have signed the agreement will benefit economically and socially through the joint NZ-Australia $55 million development package.
Long-term, trade will help transform their economies by providing reliable income and sustainable growth.
“PACER Plus also benefits New Zealand businesses by establishing a common set of trading rules covering goods, services and investment,” he says.
These rules will reduce tariffs and red tape for NZ exporters and investors as well as future-proof competitive access for NZ companies.
Despite the touted benefits of PACER Plus, the near decade of negotiations for the agreement has been polarising, with three of the region's main economies - Fiji, Papua New Guinea and Vanuatu - refusing to join.
Critics say it threatens the interests and economies of island countries and was unbalanced towards the interests of Australia and NZ.
New Zealand’s Prime Minister, the Rt Hon Bill English, who was visiting the Cook Islands as part of the Prime Minister’s Mission to the Pacific when PACER Plus was signed, says the three countries' refusal to sign was disappointing.
"It's a bit unclear to us exactly what their objections are because it's an agreement which gives a very long period of time in which to adjust trading regimes and quite a lot of assistance building the infrastructure that helps with the trade," the Prime Minister says.
"You've just got to give people time with these things,” he adds, noting he hoped the countries would eventually join the agreement.
The Federated States of Micronesia, Marshall Islands and Palau were absent from Wednesday’s signing ceremony, due to transport issues.
More information on PACER Plus will be available to business and the public in a series of upcoming public engagements on NZ’s full trade agenda.
Visit MFAT for more information about PACER Plus.