Much to the delight of Fiji, Papua New Guinea (PNG) yesterday announced the removal of import duty under the Melanesian Spearhead Group (MSG) Trade Agreement.
This would essentially mean that Papua New Guinea has taken off 400 items from the negative list that existed under the trade agreement.
During a press conference to proclaim this bold move, Attorney-General and Minister for Industry and Trade, Aiyaz Sayed-Khaiyum expressed the Fijian Government’s appreciation of this initiative by the PNG Government.
The Melanesian Spearhead Group, in 2005, revised the MSG Trade Agreement in order to remove all barriers to trade in the sub-region.
It, however, allowed members to maintain tariffs on selected products (in a so-called negative list), which is an impediment to full trade liberalisation.
“Fiji was the only country in the MSG group that did not have a negative list and with Papua New Guinea moving a step closer towards that; they have removed over 400 items from the negative list except mackerel, salt and sugar.
Fiji’s annual exports to PNG are approximately $7.6million (Fiji’s imports approximately $4.2 m from PNG annually), the majority of which will now enter PNG duty free.
“I think that it’s wonderful news that Papua New Guinea has taken this step and I would like to thank and congratulate them and their Government,” Mr Sayed-Khaiyum said.
“This is actually a win-win situation for all Melanesian countries and a step closer towards consolidating the Melanesian Group to a formidable trade and regional block.
“Of course there are a number of wonderful opportunities that exist between Fiji and Papua New Guinea. We have recently seen for example some significant investment in the tourism sector in Fiji by Papua New Guinean companies.”
Mr Sayed-Khaiyum said: “It’s now up to the private sector in both Fiji and Papua New Guinea to be able to negotiate with each other more directly and freely given that those barriers no longer exist.”
Papua New Guinea High Commissioner, Peter Eafeare, said: “This is a significant development that goes well for the future of both our countries in that it provides a stronger platform in exchange of business and allows for the further facilitation of trade.”
He said the significant part of it was that when two great economies in the Pacific like Fiji and Papua New Guinea come together, it also provides spill-over benefits for not only those in the MSG area but also beyond.