Trade focus of Pacific Islands Forum

Free trade negotiations will be a major talking point at the Pacific Islands Forum meeting in Australia next week amid claims New Zealand and Australia will benefit at the expense of smaller nations.

Pacific Island leaders will meet in Cairns, in northern Queensland, from next Tuesday for the annual four-day forum.

While the global recession, climate change and aid will be on the agenda, the Pacific Agreement on Closer Economic Relations (PACER Plus) and the future of democracy in Fiji were likely to dominate.

Oxfam New Zealand's executive director Barry Coates said an agreement on economic co-operation which focused on Pacific development was needed, rather than a standard free trade agreement (FTA).

"Against a backdrop of the enormous trade imbalance with Australia and New Zealand, and the lack of a strong base of productivity industry in the Pacific, it is clear that a new approach is needed."

An Oxfam report showed a standard FTA with Australia and New Zealand would see Tonga lose 19 percent of government income, Vanuatu 18 percent, Kiribati 15 percent and Samoa 12 percent.

It was "entirely possible" to have an economic co-operation agreement which would benefit Pacific Island nations but it needed to have a slow timetable, more resources and a new style of relationship, Mr Coates said.

The Pacific Conference of Churches also warned about the need for a cautious approach to free trade in the Pacific claiming Australia and New Zealand were bullying smaller islands.

General secretary Fei Tevi said island countries had faced "concerted pressure" from Australia and New Zealand to launch free trade negotiations "well before they were ready".

Negotiations should be based on justice and enhance social development in the Pacific.

"Unfortunately Australia and New Zealand have taken advantage of the fact that there is no clear rulebook for trade negotiations, and have pushed the region to launch free trade negotiations on terms that reflect their own political and economic priorities."

The Pacific Network on Globalisation (PANG) produced a report that "exposed the often secret world" of regional trade discussions.

PANG coordinator Maureen Penjueli said the report showed Australia and New Zealand had tried to push Pacific countries to launch PACER-Plus four years ahead of schedule.

Ms Penjueli said island countries could "redress the compromises they have been bullied into" by supporting Fiji's call for a moratorium on any PACER decisions until Fiji's exclusion from them was addressed.

Leaders from the Melanesian Spearhead Group said this month they would take Fiji's case to their peers at the Pacific Islands Forum in Cairns, Australia next month.

It was believed they would not challenge Fiji's expulsion from the forum but would focus on involving Fiji in low level discussion, possibly including PACER Plus.

Prime Minister John Key said there had been a unanimous decision to expel Fiji from the Pacific Forum and there was a desire to see a solution in Fiji by all those who has reached that decision.

Representatives from the European Union will be at the forum, including European Commission director general for development Stefano Manservisi and Ambassador David Daly.

- NZPA