Improved air services and maritime links in the region will be a key element in improving intra-regional trade, so that goods can move more quickly through the region and to other markets. The Pacific Islands Air Services Agreement (PIASA), which came into force in October 2007, aims to create a single market for air travel and provide benefits by improving access to air routes between Pacific Island states, by increasing airline alliances and code-sharing agreements, and reducing costs for airlines and travellers. The Pacific Island States Trade Agreement has been in place since 2007 to promote regional integration and achieve broader integration into the global economy. Eight countries operate under PICTA: Cook Island, Fiji, Kiribati, Niue, Samoa, Solomon Islands, Tuvalu and Vanuatu. Nauru, Papua New Guinea (PNG) and Tonga have not yet made use of the agreement. The Federated States of Micronesia (FSM), Palau and the Republic of the Marshall Islands (RMI) have yet to become contracting parties, while New Caledonia and French Polynesia may join the agreement in accordance with Article 27 of the agreement. The PICTA Protocol on Trade in Services (TIS) was concluded in 2012 and has been ratified by four signatories (Samoa, Tuvalu, republic of the Marshall Islands and Nauru), but has not yet entered into force. The Pacific Island Countries Trade Agreement Rules of Origin Manual Trade Mainstreaming Guide for Pacific Island States PACER Plus offers a small provision for technical assistance and assistance. The Australian government will provide a total of AUD 19 million to fund the management and implementation of a development and economic cooperation work programme to help the islands benefit more from trade. New Zealand will provide $7 million. Australia is committed to a target of 20% of official Pacific Development Assistance (ODA) for pacific trade aid funding.
New Zealand will approve a pacific trade aid funding target of 20% of the total ODA. Another obstacle to trade between the islands and their main developed neighbours has been sanitation and plant health protection (SPS) or animal and plant health. Many island states have not been able to meet the demanding requirements for agriculture or livestock exports. One separate chapter attempts to establish a more predictable SPS regime. However, despite improved roo and SPS measures, relative market access conditions for Pacific countries could further deteriorate, as the ASEAN Australia New Zealand Free Trade Area (AANZFTA) will eliminate tariffs on 99% of trade with key ASEAN markets by 2020. Australian and New Zealand companies will soon have less incentive to source from the Pacific Islands when they can import them duty-free from larger and more competitive Asian countries. The Peaceful Agreement on Closer Economic Relations (PACER Plus) was launched on 14 June 2017 in Tonga. The trade agreement, which covers goods, services, investments, work, sanitation and plant protection measures, aid and other issues, concludes eight years of negotiations between Australia, New Zealand and eight pacific island states. The three least developed signatories, Kiribati, Solomon Islands and Tuvalu, face a delayed tariff reduction schedule.
Vanuatu, the other least developed country in the region (LDC), was initially delayed, but then decided to join. Papua New Guinea and Fiji (which are not LDCs) have decided not to register. The extension of the PICTA agreement to trade in services and temporary migration of workers has been underway since March 2008. After seven rounds of negotiations, the picta protocol was submitted for ratification on 28 August 2012 for a one-year period. To date, the agreement has been signed by nine countries, including the Cook Islands, the Federated States of Micronesia, Kiribati, the Marshall Islands, Samoa, Tonga, Tuvalu and Vanuatu.