The Government of Samoa has welcomed the Pacific Agreement on Closer Economic Relations (P.A.C.E.R.) Plus trade agreement despite local voices of caution on its economic effects.

Officials agreed at a 15 October 2020 meeting to recommend to P.A.C.E.R. Plus Trade Ministers that the P.A.C.E.R. Plus Implementation Unit (P.PI.I.U.) be established in Samoa after a competitive bidding process. 

This is according to a press statement dated 23 October, 2020 from the Ministry of Foreign Affairs and Trade (M.F.A.T.).

The free trade deal took effect after the Cook Islands became the eighth signatory to formally ratify the trade deal earlier this month. Under the agreement rules the deal becomes effective when the eighth of eleven signatories ratified the treaty.

Samoa ratified the agreement last year, Australia, New Zealand and eight other Pacific Island countries in doing so.

The Government will support and facilitate the establishment of the P.A.C.E.R. Plus Implementation Unit in Samoa and will work closely with all P.A.C.E.R. Plus Parties.

“Samoa welcomes the Cook Islands’ ratification of the P.A.C.E.R. Plus, bringing the total to eight ratifications required to trigger the entry into force of the agreement,” said M.F.A.T.

“P.A.C.E.R. Plus will enter into force in December 2020.”

In the 23 October statement, M.F.A.T. explains that P.A.C.E.R. Plus is the regional trade, development and economic cooperation agreement in the region.

But Fiji and Papua New Guinea are not signatories.

The P.A.C.E.R. Plus implementing arrangement for development and economic cooperation will provide assistance to P.A.C.E.R. Plus island countries to strengthen their capacity, M.F.A.T. said. 

Signatories are expected to benefit from regional and international trade to achieve economic growth and sustainable development, the Government said.

M.F.A.T. says Australia and New Zealand have committed to jointly fund the AUD$25.5 million Development and Economic Cooperation Work Programme (D.E.C.W.P.) arising from P.A.C.E.R. Plus' implementation. 

The D.E.C.W.P.  has six main components linked to the different aspects of the agreement: Rules of origin and tariff commitments; customs procedures; sanitary and phytosanitary measures; technical regulations, standards and conformity; trade in services; and investment, M.F.A.T. says.

“The D.E.C.W.P. provides flexibility for emerging and changing priorities to be addressed. Signatories are considering early activities to be undertaken including in relation to COVID-19 impacts on trade,” the Ministry said.

“The P.A.C.E.R. Plus Implementation Unit will be established to deliver the [Programme].”

In preparation for the agreement coming into force, the Government says they will focus on several key areas including the prioritisation of Samoa’s trade-related needs, technical capacity building and training for stakeholders in priority areas.

Communications and long term work includes the implementation of obligations like the promotion of transparency in trade policy development; export development, trade promotion and strengthening of cooperation through the Arrangement on Labour Mobility.

M.F.A.T. did not respond to Samoa Observer inquiries sent via email before the trade agreement was ratified.

A Campaigner from the Suva-based Pacific Network on Globalisation, Adam Wolfenden, told the Observer that Samoa already has duty free quota free market access to Australian and New Zealand markets so a new trade deal won't offer any additional benefits.

After the agreement was made effective following the Cook Islands ratification, economist and President of the Tautua Samoa Party Luagalau Dr. Afualo Wood Salele, told the Observer that P.A.C.E.R. Plus is not a win-win for Samoa.

“From what I see when looking at this, we need to use this trade agreement to lower the costs of the goods and services that we are importing to Samoa. If we leave those entirely to the forces of supply and demand, you’ll find that the expenses and the costs will be higher and the consumers will have to pay more,” Luagalau said.

“There are taxes that will be levied but we need to make sure that the goods and services we  are trading for, are being traded with an agreement that will not only benefit them but will also benefit us.”

Following its taking effect, Australian Member of Parliament Alex Hawke said trade and prosperity in the Pacific will thrive under P.A.C.E.R. Plus.

“P.A.C.E.R Plus will deliver new and enhanced trade opportunities for Australia and our Pacific partners, with benefits to flow in farming, fisheries business and increased investment in the region. Through P.A.C.E.R Plus we will work together in the interests of trade, investment and the prosperity of the Pacific,” said Mr. Hawke.

“This historic agreement represents further evidence of the increasing depth of Australia's relationship with its Pacific family. The Agreement will also support Pacific Island partners as they work to recover from the economic impact of COVID-19.”

Australia will provide AUD$19 million to support its Pacific partners as they work to implement P.A.C.E.R Plus, to ensure they can fully embrace the export benefits available to local businesses, he added.

“Australia looks forward to working with regional partners to take full advantage of the opportunities offered by PACER Plus in the interest of our region,” Mr. Hawke said.