Prime Minister explains why he signed PACER Plus

Vanuatu Prime Minister Charlot Salwai

By Jonas Cullwick

Prime Minister Charlot Salwai has appealed to the business community to work together with the Government to find ways to expand the business base of the country.

He made the appeal following his return from signing the PACER Plus agreement in Samoa.

The Prime Minister said he has heard their concerns, some of which were raised by the Vanuatu Chamber of Commerce and Industry (VCCI) but he is appealing to all in the business community to work together with the government to find ways to expand the business base of the country.

On concerns by businesses represented by VCCI over government’s signing of the PACER Plus that they will go to other countries such as Samoa and Fiji, the PM said Samoa also signed the agreement and other countries. Only countries that did not sign are former US trust territories whose tariffs are connected to US ones.

“We hear that some of the businesses want to leave because of the income tax, now we hear they want to leave because of PACER Plus, but most countries have signed the agreement and Vanuatu’s probably the only country that does not have an income tax.

“I don’t know about the threat they are making, but Vanuatu wants to open up to more businesses to come into the country and provide opportunities to other businesses to come in.

“I believed that through this trade agreement, if there are facilities to assist businesses then we can look at assisting the existing ones to further expand their activities because the intention of the government is to assist businesses to operate and trade.

“This is so we want to find ways to assist these businesses and if we can access support through PACER Plus, maybe we can help them by way of assistance to them to further develop their operations and businesses.”

He warned against protectionist policies.

“If we protect them, then we will be in breach of the WTO rules and secondly we will be protecting the same businesses and the same possibilities they offer, which means the economy will not be expanded.

“I think government should continue with its policy of encouraging competition and opening up more opportunities for ni-Vanuatu people to do business in the country.

“I hear their concerns, but just to hold the trade show in New Caledonia, the Vanuatu Week, they ask the government to fund it.

“I am asking all in the business community to work together with the Government to find ways to expand the business base because the Government wants to expand its tax base so it can earn more revenue to meet its obligations in the social and the economic sectors.”

Meanwhile, PM Salwai explained that he signed the PACER Plus trade agreement with Australia and New Zealand last week because it was better economically for Vanuatu to be “in” the agreement to make use of the negotiation stage to reach trade deals that will benefit the country.

He said Vanuatu will not benefit from staying outside of PACER Plus.

“There is a lot of talk on the streets asking why the Government decided to sign the PACER Plus,” he said.

“I signed the PACER Plus agreement at the South Pacific Forum Leaders meeting in Apia, Samoa last week, following a decision of the Council of Ministers.

“Vanuatu was part of its initiation of the agreement, unfortunately it took time in consultation in Vanuatu at the government level, with the private sector and the civil society on its benefits before the Council of Ministers decided we sign the PACER Plus agreement.

“At the same time too the Council of Ministers decided for government to sign the MSG Trade Agreement.

“Following this decision, I signed the regional trade agreement on behalf of the government and the nation,” the Prime Minister said.

“If we don’t sign then we won’t be able to negotiate trade including accessing assistance from the aid for trade program as other countries are able to do after signing and we are the 11th country to do so.

“It will be hard for us to negotiate if we stay outside of the agreement.

“So, the reason for signing is so we can be “in” to be able to negotiate our trade and issues to do with kava for example.”

The Prime Minister said concerns the country has in relations to the agreement “are still there for us to negotiate, but we must be inside the PACER Plus agreement to negotiate them”.

He said he was able to meet with the Australian Prime Minister, Malcolm Turnbull, on the corridors of the Forum meeting, on bilateral matters and raised Vanuatu’s concerns on trade issues.

“When I say trade it means our trade in goods and our trade in services.

“And one of those in services, in which Vanuatu is already leading and benefiting from even through on a one-sided level in PACER Plus, which we are part of, is labour mobility in New Zealand’s Recognized Seasonal Employment (RSE) scheme and Australia’s Seasonal Workers Program (SWP), which this year alone already we have sent over one thousand people.”

The Vanuatu Prime Minister explained that this too can be affected if Vanuatu does not sign PACER Plus, in areas to be accessed such as Tasmania, which is taking a long time to materialize and it could be because the country did not sign PACER Plus when other countries signed in Tonga.

“At our meeting with the Prime Minister of Australia he assured me and the Minister of Foreign Affairs (Bruno Leingkone), that Australia will expand the scheme to allow for more ni-Vanuatu to work in Australia’s labour mobility.

“In addition to this, he assured me that Vanuatu skilled workers entering the scheme will be given three-year visas to work in Australia. This means it is a progress on what we have now.”

The Prime Minister said another issue the leaders raised at the Forum retreat with the Prime Minister of Australia concerned the normal visa arrangement, which will be the subject of bilateral relations between Australia and Vanuatu.

“We go into PACER Plus so we can expand our trade sector and expand the activities of existing ones so they can provide job opportunities for the people of Vanuatu and at the same time too attract new business opportunities for ni-Vanuatu wanting to go into business.”

He said creating more job opportunities for the people will be good for government so it can expand its tax base.

“I think it is good for us to be in PACER Plus so we can negotiate rather than staying outside and only operating at bilateral level.

“And if we do not join, it is also possible that bilateral too can be affected. All this is the reason why government decided to sign the regional trade agreement.

“It is too early at this stage to say that Australia will not fulfill its promise to as mentioned in the Opposition Facebook forum because we haven’t entered into the negotiations yet.

“Also, at the bilateral discussions with Australia’s Prime Minister and at the forum retreat I asked if Vanuatu can host the PACER Plus Implementation Unit, so we can monitor progress and quickly voice concerns.

“Now we have 4,000 workers in New Zealand and Australia and if we did not sign PACER Plus and they do not find employment then that can be another serious issue to manage.”

The Prime Minister said he has heard their concerns, some of which raised by the Vanuatu Chamber of Commerce and Industry (VCCI) but he is appealing to all in the business community to work together with the government to find ways to expand the business base of the country.

On concerns by businesses represented by VCCI over government’s signing of the PACER Plus that they will go to other countries such as Samoa and Fiji, the PM said Samoa also signed the agreement and other countries. Only countries that did not sign are former US trust territories whose tariffs are connected to US ones.

“We hear that some of the businesses want to leave because of the income tax, now we hear they want to leave because of PACER Plus, but most countries have signed the agreement and Vanuatu’s probably the only country that does not have an income tax.

“I don’t know about the threat they are making, but Vanuatu wants that we open up to more businesses to come into the country and provide opportunities to other businesses to come in.

“I believed that through this trade agreement, if there are facilities to assist businesses then we can look at assisting the existing ones to further expand their activities because the intention of the government is to assist businesses to operate and trade.

“This is so we want to find ways to assist these businesses and if we can access support through PACER Plus, maybe we can help them by way of assistance to them to further develop their operations and businesses.”

He warned against protectionist policies.

“If we protect them, then we will be in breach of the WTO rules and secondly we will be protecting the same businesses and the same possibilities they offer, which means the economy will not be expanded.

“I think government should continue with its policy of encouraging competition and opening up more opportunities for ni-Vanuatu people to do business in the country.

“I hear their concerns, but just to hold the trade show in New Caledonia, the Vanuatu Week, they ask the government to fund it.

“I am asking all in the business community to work together with the Government to find ways to expand the business base because the Government wants to expand its tax base so it can earn more revenue to meet its obligations in the social and the economic sectors.”

Jonas Cullwick, a former General Manager of VBTC is now a Senior Journalist with the Daily Post. Contact: jonas@dailypost.vu. Cell # 678 5460922

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