PACER Plus will help Pacific island countries to become more active partners in, and benefit from, the regional and global trading system, in turn creating new opportunities for economic growth, jobs and rising living standards. Dedicated assistance is critical to achieving these outcomes.
To this end, PACER Plus includes a Chapter on Development and Economic Cooperation and an accompanying Implementation Arrangement. These provide the framework through which Parties will work together to identify needs for assistance, prioritise activities and evaluate progress throughout implementation.
Before these instruments come into effect, Australia and New Zealand will support a Readiness Package to support parties in their preparation to ratify the Agreement.
This sequenced programme of development assistance is designed to meet the diverse needs and priorities of the Parties, enabling efficient implementation of the Agreement and also building broader institutional and productive capacity for sustained impact. The full scope of this assistance is outlined below.
PACER Plus Readiness Package: immediate technical support for ratification, customs, notification and revenue planning
Recognising that the process of ratification of multilateral trade agreements can take time, Australia and New Zealand announced in August 2016 a package of immediate technical support for preparation, ratification and early adjustment. This support, to be rolled out as soon as the Agreement is signed, responds to a needs assessment undertaken by the Office of the Chief Trade Adviser (OCTA) and will enable signatories to reap early benefits from the Agreement.
Australia and New Zealand will provide a joint funding package (of $4 million and NZ$4 million from each respective country) for ‘readiness’ activities. These targeted activity streams were identified in the needs assessment and agreed through the course of negotiations. The activities of the Readiness Package will include:
- Legislative drafting: Support to assist signatories review and update relevant national laws and regulations.
- Customs modernisation, harmonisation, implementation of up to date tariff codes and transposition of schedules: In PACER Plus, like other current FTAs, goods will be identified by the internationally-recognised system known as the Harmonized Commodity Description and Coding System (HS), which is updated every five years. The Readiness Package will support the Oceania Customs Organisation (OCO) to assist each PACER Plus signatory to implement the latest version of the code, HS 2017, and to position them to undertake the five yearly update. The OCO will also help signatories transpose the Agreement’s tariff schedules into the latest code.
- Training on notification requirements under the Agreement: An important feature of PACER Plus is that it sets out obligations which promote transparency, availability of information, contact points and certainty for the private sector which are essential for trade and investment. The Readiness Package thus includes targeted training for government and private sector entities to meet these obligations, including the new product specific rules and Rules of Origin.
- Public outreach and stakeholder engagement: Support will be provided for the production and dissemination of targeted communication materials for business, civil society and the general public which explain the Agreement.
- Revenue planning and mitigation: As participants reduce tariffs on imports, some countries may need to modernise their fiscal systems and mobilise alternative sources of government revenue. The Readiness Package will provide support to enable FICs to plan for any such adjustments.
All support under the Readiness Package is designed to be flexible and responsive to PACER Plus signatories and will be adjusted based on needs, with some activities potentially continuing into the implementation phase once the Agreement enters into force.
PACER Plus Implementation Package: coordinated support across each core aspect of the agreement
Upon ratification, the Joint Committee of PACER Plus Parties will act as a governing board for approving a work programme of development assistance linked directly to the Agreement.
Parties will establish an implementation unit to prepare information and advice for the Joint Committee and administer activities. Australia and New Zealand will provide a joint funding package (of $19 million and NZ$7 million from each respective country) over five years once the Agreement enters into force. The support will accommodate evolving needs and is extendable by consensus of the Parties. As agreed in negotiations, it will focus on activities to implement Parties’ obligations in regard to:
- Rules of Origin and other Aspects of Implementation of Tariff Commitments
- Sanitary and Phytosanitary Measures
- Technical Regulations, Standards and Conformity Assessment
- Trade in Services, and
Broader aid for trade to build productive capacity
Alongside the Agreement’s central trade capacity building package for PACER Plus implementation, Australia has committed to an aid for trade funding target of 20 per cent of its ODA budget for the Pacific. In 2016-17, total ODA to the Pacific is estimated to be up to $1.1 billion. This aid for trade funding will support Pacific island countries to better integrate into and benefit from the global trading system, implement domestic reform, and make a real impact on the lives of their citizens.
Australia will deliver this broader aid for trade through its Pacific regional and bilateral development programmes with PACER Plus Parties. Australia will consult individual governments regarding their priorities through existing regular aid partnership talks. Australia’s Pacific aid for trade support will complement the Parties’ own trade-related initiatives to increase economic growth, generate jobs and increase living standards. Some key regional initiatives already underway are:
- Agricultural export development: The Pacific Horticulture and Agricultural Market Access Program (PHAMA) helps Pacific exporters meet quarantine standards and other market access requirements of trading partners, including Australia and New Zealand. The new phase of the PHAMA program is due to commence in mid-2018, and will include a specific focus on supporting PACER Plus signatories.
- Trade facilitation, export promotion and investment: Australia has increased funding to the Oceania Customs Organisation (OCO) to help strengthen Pacific customs administrations, and will continue long-standing support for Pacific Trade and Invest (PT&I) which provides high-quality export facilitation, investment and tourism promotion services across the region.
- Private sector development and job creation: An extended partnership with the International Finance Corporation (IFC) will see activities directed to ensuring the Pacific is able to fully benefit from a more open trade regime in the region. Through the Asian Development Bank (ADB), targeted financial and business advisory services are being provided to eligible small to medium enterprises to foster private sector led economic growth and job creation, along with assistance to improve the environment for business through the Private Sector Development Initiative. In addition, a new programme, Pacific RISE is working with investors to promote investments in Pacific enterprises.
- Labour mobility and remittances: Australia is committed to expanding its support in this priority area of interest to FIC partners given its important development impact. As announced in the White Paper on Developing Northern Australia [PDF], Australia has abolished the cap on places, included the broader agricultural industry and accommodation sector and introduced a pilot scheme for the tourism industry in Northern Australia through the Seasonal Worker Programme.