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The Pacific Agreement on Closer Economic Relations (PACER) is an umbrella agreement between members of the Pacific Islands Forum (the Forum Island Countries plus Australia and New Zealand) which provides a framework for the future development of trade cooperation. It was first signed at Nauru on 18 August 2001 and entered into force on 3 October 2002. It is a framework agreement that sets an outline for the future development of trade and economic relations across the Forum region as a whole. It does not contain substantive trade liberalisation provisions; rather it envisages a step-by-step process of trade liberalisation. This starts with a free trade agreement in goods among Pacific Island countries (PICTA – the Pacific Island Countries Trade Agreement), in the process of implementation as of September 2008, and later likely to be extended to services. PACER provides for programmes of assistance to the island country members with trade facilitation and capacity building. It also foreshadows future negotiations on Forum-wide reciprocal free trade (including Australia and New Zealand). For the moment these negotiations are not scheduled until 2011, but they are likely to be brought forward as a consequence of the Pacific Island countries' negotiation of an Economic Partnership Agreement with the European Union.

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