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MSG Needs To Balance Sub-regional Trading Bloc, Dion Says

Papua New Guinea Deputy Prime Minister, Leo Dion, says PNG has seen some significant increase in foreign direct investments from Melanesian Spearhead Group (MSG) member nations. This, he said, was
02 Dec 2014 09:19
MSG Needs To Balance Sub-regional Trading Bloc, Dion Says
Fijian Minister for Industry, Trade ans Tourism., Faiyaz Koya (right), in discussions with the Permanent Secretary for Industry and Trade, Shaheen Ali, during one of the sessions at the Melanesian Spearhead Group Investment Roadshow and Trade Fair in Papua New Guinea the past week.

Papua New Guinea Deputy Prime Minister, Leo Dion, says PNG has seen some significant increase in foreign direct investments from Melanesian Spearhead Group (MSG) member nations.

This, he said, was despite a low volume trading of goods among these nations.

He said trading of goods among member economies had declined and the question remains on the potential to grow intra MSG trade and investment.

Mr Dion told the Trade Ministers of MSG nations that there was potential for future growth in terms of trading activities.

“PNG offers much new and exciting foreign direct investment opportunities especially in the services, tourism, manufacturing and fisheries sector,” he said.

“We in PNG are committed to greater MSG integration and even more MSG trade and investment. However, we fully recognise and respect this is a sensitive issue.

“We sincerely recognise the serious economic challenges each of our members face and your state of readiness to even consider serious integration as a common sub-regional trading bloc.”

Mr Maru said after 21 years of trading under the MSG trade agreement, PNG still had not achieved some key outcomes.

Key Outcomes Not Achieved:

Papua New Guinea Deputy Prime Minister, Leo Dion said after 21 years of trading under the MSG trade agreement, PNG still had not achieved some key outcomes. These are as follows:
– Agreeing on a fixed deadline to have an MSG Free Trade Area (FTA)
– No double tax incentives among ourselves. PNG and Fiji have a double tax treaty
– No investment promotion and protection agreement amongst
– Failed to make travel for our businessmen and women easier in terms of connectivity because there no MSG travel card similar to the APEC card

 Double tax treaties will see MSG countries in win-win situation

The Melanesian Spearhead Group countries will have double tax treaties and investment promotion protection agreements by 2017.

Papua New Guinea’s Trade Commerce and Industry Minister Richard Maru has confirmed this.
This was one of the 11 recommendations of the MSG Trade Ministers’ meeting in Port Moresby the past week.

Mr Maru said the ministers had agreed that the use of travel cards would make it easier for people to travel and do business in the sub-regional trading bloc.

Papua New Guinea Prime Minister Peter O’Neill opened the MSG Trade and Investment Roadshow in Port Moresby saying it paved the way for discussions on trade agreements between MSG member nations.

Mr Maru said: “Everyone has products and services to market, even skills that we can market.
“We now have interest from New Caledonia, Vanuatu, Timor Leste and West Papua to join the MSG sub-regional trading bloc to do business together.”

Thirty-five booths had been allocated to Solomon Islands, Vanuatu, Fiji, West Papua, and New Caledonia to exhibit goods. Forty-three booths were for PNG companies.

Melanesian Spearhead Group declaration:
– Achieving a Free Trade Area by 2017
– Concluding MSG Trade Agreement 3 negotiations on Goods and Services by 2015
– Concluding Double Tax Treaties on IPPAs by December 2017
– Enhancing the mechanism for implementing the Skills Movements Scheme
– Strengthening MSG’s customs and biosecurity co-operation in the context of the MSG Trade Agreement 3
– Mapping out a clear private sector development strategy by 2015
– Enhancing MSG Connectivity through the MSG Travel Card by 2015
– Fund and conclude a MSG Shipping study by the end of 2015.
-Promoting investments in the MSG Roadmap on Inshore Fisheries and Managements and Sustainable Development
– Fostering Investment Roadshows as a means to enhancing business-to-business linkages
– Supporting the work of the Finance Ministers and Central Bank Government and CEOs of Pension and Provident Funds on the establishment of a Development and Investment Fund and Emergency Stabilisation Fund.

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