SOLOMON ISLANDS TO HOST ‘PACER’ TRADE TALKS

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Stakes high for 14 forum countries

HONIARA, Solomon Islands (Solomon Star, Oct. 13, 2010) – Next week Honiara will host round 2 of the negotiations between 14 Forum Island Countries (FICs) and Australia and New Zealand (ANZ) on the proposed and controversial Pacific Agreement on Closer Economic Relations (PACER-Plus).

[PIR editor’s note: Pacific Agreement on Closer Economic Relations-Plus is a trade and economic agreement that was endorsed during a Forum meeting in2001 that aims to promote regional trade corporation between Forum Island countries and Australia and New Zealand]

A lot is at stake as PACER-Plus is the most important economic and trade negotiations that FICs will undertake this decade. If agreed to, it will result in a binding international agreement whose scope and impact will be huge - so huge and far-reaching that it will eclipse any other regional initiatives.

Nauru and other FICs must therefore shape the agenda now and get this right if they are to benefit.

To get it right Nauru’s Secretary of Foreign Affairs and Trade and fellow Solomon Islander, Robert Sisilo, will be constantly searching and asking "what’s in it for Nauru?"

At the moment, precisely what PACER-Plus will be is a matter for negotiations.

It is therefore still uncertain what PACER-Plus will look like.

But following some initial consultations among its stakeholders, Nauru will flag a number of things it believes could actually assist its economic development in a trade agreement with ANZ.

One of these is development cooperation.

Nauru will be looking for an agreement that has clear development benefits without significant adjustment or implementation costs, a trade agreement for development rather than the promotion of trade for its own sake.

Labor mobility will also go a long way in addressing the development challenges facing Nauru a 21 square kilometers country of 11 thousand people.

Besides phosphate and fish, its people are about the only other resource Nauru has.

So for Nauru if the PACER Plus process does not significantly enhance the movement of unskilled and semi-skilled labor then the conclusion of the process is uncertain and may be protracted.

Otherwise the cost of making commitments on goods and services could well outweigh any benefits arising from PACER-Plus.

The development of infrastructure, particularly sea ports, shipping and aviation, are also crucial if FICs, particularly the small island states, are to trade at all.

Unless there is adequate infrastructure and cheaper forms of transportation and regular shipping, the prospect to trade under PACER Plus will simply be zero particularly for the remote and vulnerable small island states like Nauru.

So these things, sea ports, airports, shipping, fuel costs etcetera must also feature prominently on the PACER Plus Agenda.

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