Page 27 - Islands Business January 2021

Trade Trade

PACER Plus. ‘Pacific Integration Visa’ that would allow Pacific islanders to
While he ignores the significant criticisms of PACER Plus become permanent residents after a period of employment in
made by Australia’s most important FIC trading partners (PNG Australia”.
and Fiji), Redden approvingly quotes the endorsement by Morgan suggested that Australia and NZ ought to assist FICs
Cook Islands, whose economy is largely underwritten by NZ especially for niche high value added agricultural exports in
and not dependent on PACER Plus at all. which FICs had comparative advantage, such as kava, single-
Redden merely asserts “Overall, PACER Plus is a win-win source chocolate and coffee, ginger, vanilla and other spices,
agreement”. high-value hardwood timbers, coconut oils and indigenous
nuts. This did not require PACER Plus.
The opposing views by Wolfenden Morgan urged Australia “to learn from the experience of
Wolfenden however pointed out that PACER Plus will merely negotiating PACER Plus and ensure the current Pacific Step
“facilitate one-way access for Australian and New Zealand Up creates new trade and labour mobility opportunities”
exporters and investors into Pacific markets instead of the whose value to Australia had been clearly demonstrated by
other way around.” He quoted the PNG Minister Richard Maru COVID-19.
who had complained in 2017 about PNG’s “lopsided” trade
with Australia. The Australian JSCT
While acknowledging the theoretical benefits that could While the Australian Government does not particularly need
result from changes in the rule of trade and investment, to take on board the views of critical academics, it surely
Wolfenden noted that these benefits already existed under ought to heed its own Parliamentary Joint Standing Commit-
previous agreements with Australia and NZ such as SPARTECA, tee on Treaties, as quoted extensively by Nic Maclellan. (DPB,
and that even these be would progressively eroded by Austra- May 16, 2018).
lian and NZ concessions to other third countries. The JCST noted that the absence of Papua New Guinea and
Ultimately, overall lack of capacity in trade negotiations Fiji from PACER-Plus “significantly diminishes the utility of the
meant that FICs would always struggle to maintain or grow agreement for Australian business” given that Australian trade
their infant industries while PACER Plus would require FIC with the Pacific signatories of PACER Plus was less than 5% of
economies “to be open to foreign investment and to prioritise the trade with PNG and Fiji.
the needs of investors over other concerns”. While the JCST did not see PACER Plus providing any
For Wolfenden PACER Plus represented “a squandered op- significant additional benefits, it noted that the respected
portunity to address the real development needs of the region Public Health Association of Australia (PHAA) had pointed to
and a waste of time and significant resources.” likely negatives: such as risks for FICs associated with liber-
He urged Australia and NZ to focus on “assisting PIC ex- alisation of health services; reduced government capacity to
porters to meet quarantine standards in Australia and New raise revenue and provide health services; and burdensome
Zealand... supporting the emergence of new PIC industries, requirements to justify public health measures such as bans
promoting the diversification of PIC economies and ensur- on tobacco or junk food imports.
ing that the traditional systems and cultural practices in the A severe indictment of the PACER Plus negotiation process
Pacific aren’t displaced by Western-style investments.” itself that the JCST worried about the “lack of independent
assessment of social and economic benefits claimed by the
The Middle Path of Wesley Morgan Australian government”.
Wesley Morgan, drawing on earlier joint work with Tess FICs also ought to be concerned given that former Forum
Newton Cain published with the Griffith University’s Griffith Secretary General Sir Noel Levi who had guided the initial
Asia Institute, also argued that “a standard regional free trade drafting of PICTA and PACER in the late 1990s, was critical of
agreement was never going to stimulate significant economic the Forum Secretariat leadership in failing to give sufficient
growth in the Pacific islands”. weight to the views of PNG and Fiji. His scathing conclusion
Pacific trade negotiators had argued that PACER Plus should what that the result was a “Pacific Minus” which served more
be an ‘FTA-Plus’ arrangement, including trade-related aid and the interests of Australia and NZ.
allowing Pacific islanders to work temporarily in Australia and Maclellan also quoted Dr. Patricia Ranald of the Australian
New Zealand. Fair Trade and Investment Network “at a time when many
Unfortunately, Australian negotiators resisted these pro- commentators are concerned about China’s influence in the
posals and their minor concession of a labour mobility ‘side region, resentment about such a deal could contribute to a
arrangement’ to PACER Plus “proved sufficient enticement for reduction in Australia’s and New Zealand’s influence.”
most Pacific island states to sign the deal”.
But Papua New Guinea and Fiji had refused to sign on, cit- Conclusion
ing limited benefits and accused Australia and NZ of “back- One cannot disagree with the concluding statement by Aus-
tracking” on their initial commitments by “leaving labour tralian Minister Hawke: “People are at the heart of Australia’s
mobility and development assistance out of the deal itself”. partnerships in the Pacific. Greater economic integration will
Morgan argued for the expansion of existing labour mobility bring people closer together, underpin recovery, and build a
schemes to new industries and sectors and “creating a new Continued on page 30

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