Fair deals a Pacific pipedream

Flint Duxfield is a co-director of AID/WATCH, an independent monitor of aid and development issues.

Labour mobility may be in the headlines but as Kevin Rudd talks the talk at the Pacific Islander Leaders' forum in Nuie, he'll have one thing on his mind; trade.

Allowing Pacific workers to plug the holes in Australia's labour market is certainly a priority for Australia's farmers. But the real gain for Rudd lies in the bargaining power the scheme will give Simon Crean as he moves into the second phase of the Pacific Economic Cooperation Agreement negotiations, the free trade agreement Australia and New Zealand are negotiating with the Pacific countries.

It's an approach that strongly resembles the aid-for-trade model heavily promoted within the World Trade Organisation. Developing countries that liberalise their economies are rewarded with aid packages designed to ''minimise the adjustment costs'' associated with rapid liberalisation and allow them to ''maximise the benefits'' of new market access. An expanded aid program will help overcome the revenue loss for pacific governments and the labour mobility scheme will take the edge off any unemployment which occurs as domestic producers become displaced by Australian imports.

Or so the theory goes.

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