The Coalition Government, via the Ministry of Trade, is engaging in nationwide consultations with industries and the business community to reassess its stance on the Pacific Agreement on Closer Economic Relations (PACER) Plus. This international treaty, which established a free trade agreement between Australia, New Zealand, and the Forum Island Countries, took effect in December 2020. The participating countries include Australia, Cook Islands, Kiribati, New Zealand, Niue, Samoa, Solomon Islands, Tonga, Tuvalu, and Vanuatu. Although Nauru has signed the agreement, it has yet to ratify it, while Fiji, Papua New Guinea, the Federated States of Micronesia, Palau, and the Marshall Islands took part in negotiations but did not sign.
Stakeholders are encouraged to thoughtfully share their insights during the consultations, focusing on the agreement’s potential benefits and costs for Fiji, as well as what the country stands to gain or lose.
During a consultation in Suva at the Civic Auditorium, Deputy Prime Minister and Minister for Trade Manoa Kamikamica emphasized that Fiji’s trade interests are well-represented by the attendees. He stated that PACER Plus aims to address the challenges faced by Pacific island economies and provide a foundation for increased trade and economic cooperation.
Fiji had previously participated in PACER Plus negotiations but chose not to sign the agreement for various reasons. Following a change in government, the Coalition Government indicated its intention to consider joining the agreement, announcing last year that it would revisit PACER Plus after prioritizing the Indo-Pacific Economic Framework for Prosperity (IPEF).
The ongoing consultations aim to reassess Fiji’s position regarding PACER Plus, taking into account how joining the agreement aligns with national interests and development goals. Kamikamica asserted that Fiji would not join if it was not beneficial for the nation.
He highlighted the Pacific island economies’ unique challenges, including geographical isolation and limited market size, which necessitate a tailored approach to economic growth and development. Balancing the trade deficit with Australia and New Zealand, currently exceeding $1 billion, is critical, and any trade agreement must account for this imbalance.
With Australia and New Zealand as Fiji’s largest trading partners, it is essential to evaluate how PACER Plus could affect Fiji’s trade dynamics. Questions remain regarding which country’s trade would increase as a result and how tariff revenue loss might impact Fiji’s fiscal situation.
Kamikamica pointed out the need to analyze PACER Plus’s provisions carefully and their implications for Fiji’s structural economic challenges, including diversification and supply chain resilience. He stressed that the government has a duty to ensure that any trade agreement is equitable, development-oriented, and genuinely beneficial to Fiji.
As global trade landscapes shift, particularly post-COVID-19, it remains crucial to reassess whether the initial decision to stay out of PACER Plus is still in Fiji’s best interest. The consultations are a platform for gathering views and concerns regarding PACER Plus and determining its potential contributions to Fiji’s long-term development goals, economic diversification, job creation, and resilience against climate change.