The Minister for the Economy, Foreign Trade and Energy in New Caledonia’s new government last week visited Australia hoping to discuss the removal of “double taxation” on businesses and start negotiations for a free-trade agreement.
He told The Sydney Morning Herald and The Age the previous government in New Caledonia was “protectionist”, wanting to export without importing. “The attitude has changed and turned around completely,” he said.
Australian imports to New Caledonia totalled $394 million in 2018, while exports from the territory to Australia were valued at $30 million.
Mr Gyges said he had begun working on a tax agreement that would attract more Australian investors to the territory by avoiding double taxation. Under current arrangements, some businesses are being taxed in both New Caledonia and Australia.
“There is a tax agreement between France and Australia, which makes it possible to only be taxed in the country of origin and to avoid this double taxation,” he said. “And what we wish for is for New Caledonia to piggyback off this tax agreement to avoid this double taxation and to promote the development and installation of businesses in New Caledonia.
“We have set up various arrangements of tax-free areas to support and promote investors and we have created a single docket office to attract investors, and we wish for the Australian investors to actually feel welcome in New Caledonia.”
Mr Gyges said he wanted to strike trade deals with individual states and the Australian government, saying the biggest opportunities were in the resources, renewable energy and tourism sectors. His government was in discussions with Qantas and Virgin about adding more flights, he said.
Acknowledging that more than two-thirds of New Caledonia’s energy came from fossil fuels, Mr Gyges said there was a need to move to greener sources of electricity amid growing concern in the region about climate change and rising sea levels.
China has been splashing billions of dollars in the Pacific, with Papua New Guinea, Vanuatu, Tonga and Samoa all beneficiaries of so-called soft loans for infrastructure projects from Beijing. The Morrison government’s Pacific “step-up”, which includes a bigger defence presence and more development assistance, has been welcomed in the region, but Pacific nations have criticised Australia for its lack of action on climate change.
France has also been boosting its presence in the region, with President Emmanuel Macron in 2018 declaring his country and Australia were “forces for good” in the world.
Mr Gyges said there was a need for greater cooperation between Australia and France on trade, education, training and infrastructure throughout the region. He also supported greater defence ties between France and Australia but said this was a matter for the French government.
“Defence is a matter of the national state … Nevertheless, what we see through my conversations is there is a clear willingness to reinforce exchanges in the defence space between France and Australia,” he said.
A spokesman for the Department of Defence said Australia was encouraging more cooperation to support the security of Pacific Island nations.
“Australia is keen to continue working with France in the Pacific bilaterally, as well as through other regional mechanisms, such as the South Pacific Defence Ministers’ Meeting and the Pacific Quadrilateral Defence Coordination Group,” the spokesman said.
Anthony is foreign affairs and national security correspondent for The Sydney Morning Herald and The Age.