2 Dec 2004

Trade war looming between Vanuatu and Fiji

11:17 am on 2 December 2004

A potential trade war is looming between two Pacific island neighbours after Vanuatu imposed a ban on the import of biscuits from Fiji.

Fiji TV reports that Fiji's ministry of foreign affairs has given a 14-day ultimatum to Vanuatu to explain its actions or face retaliatory action.

A strongly worded diplomatic note says unless Vanuatu comes to the negotiating table, Fiji will be forced to take similar action.

The Vanuatu ban is in breach of the free trade agreement between countries of the Melanesia Spearhead Group.

The chief executive officer of the foreign ministry, Isikeli Mataitoga, says the government has to ensure that multi-lateral agreements signed by countries are honoured.

Already there are suggestions in Fiji that the country should ban the import of Vanuatu kava, worth six million US dollars a year.