In an important address to the Papua New Guinea Association of Australia yesterday, Parliamentary Secretary for Pacific Island Affairs, Duncan Kerr, foreshadowed a comprehensive Pacific trade pact to enable countries in the region to share more fully the benefits of increased economic growth.

The annual Christmas lunch of the Association was attended by nearly 250 people who Mr Kerr referred to as embodying "the remarkable vitality" of the Australia - PNG relationship.

Mr Kerr said that, in Australia's view, there is a sure way of improving the prospects of stable and long-term economic growth in the Pacific region. “That is to more effectively integrate the nations of the Pacific with the wider global community, and to free up the flow of goods, services and investments within the region,” he said in a speech entitled, 'Australia and PNG: New Beginnings'.

“Australia's relationship with Papua New Guinea is, by any measure, one of our deepest and most enduring,” he said, adding that, “through its extensive networks in Australia, the PNG Association of Australia has been integral in maintaining these people-to-people links.”

“Papua New Guinea plays an important leadership role in this region, and as such is well-placed to assist its Pacific neighbours,” he said. “If you set aside Australia and New Zealand, Papua New Guinea has the largest regional economy and its population represents almost three-quarters of the population of the Pacific Island states.”

Mr Kerr said Australia is strongly committed to supporting the HIV/AIDS response in PNG. “Only through an energetic campaign of education, prevention and management can we help PNG drastically reduce the chances of a sharp increase in the number of HIV/AIDS sufferers. Unless more is done to address the spread of HIV/AIDS in PNG, the country's workforce may decline by 12.5% by 2025 and significantly reduce the size of PNG's economy.”

The Parliamentary Secretary said that over 4,000 Australian businesses trade with PNG and that, in 2007, bilateral merchandise trade was worth over $4 billion, with the balance of trade in PNG's favour.

“It has been encouraging to see the PNG Government's recent strong economic management record,” Mr Kerr said. “[the PNG] government has reduced government debt levels, and kept both the budget and the current account in surplus. Maintaining these settings will be a major challenge in the tougher economic climate we all face. To meet these and other challenges, Sir Michael's Government will need to continue to push forward with much-needed economic reform - which, as we ourselves know only too well, is a major commitment and requires sustained effort.”

Mr Kerr said that understandings have recently been signed with Kiribati, Tonga and Vanuatu relating to Australia's Seasonal Worker Pilot Scheme. Australia is currently engaged in talks with the PNG Government to facilitate participation in the scheme by Papua New Guineans.

“The scheme is not, and doesn't pretend to be, a simple solution to the challenge of unemployment in the Pacific,” he said. “It's a scheme that is demand driven by the Australian horticultural sector but also a part of an overall development response we're working out together with Pacific nations.”

Mr Kerr said the PNGAA embodied the bilateral relationship between Australia and PNG, which was one of “remarkable vitality”.

“Our respective societies are bound together by ties that far transcend the govemment-to-government contacts that I'm now engaged in. As neighbours, we enjoy not only a tremendously strong sense of shared history, but, dare I say, an equally strong sense of a shared future. That future will depend on people like you.”