By Eoin Blackwell, AAP Port Moresby Correspondent
PNG Prime Minister Peter O'Neill and Fiji's interim prime minister, Frank Bainimarama, signed off on the Vodafone Fiji venture in Port Moresby on Tuesday.
|PAA © Vodafone Fiji will take over management of PNG mobile phone carrier bemobile.|
"We have more mobiles than people," Mr Bainimarama said.
"The term historic is often over-used, but not in this instance. The two leading island nations, Fiji and PNG, have joined hands in a joint commercial venture that promises to revolutionise the lives of all our people for the better."
About 35 per cent of PNG's roughly seven million people currently have access to a mobile phone, compared with 110 per cent coverage in the smaller Fiji islands.
Fiji's National Provident Fund will take a 40 per cent share of bemobile, while the PNG government's commercial arm, the Independent Public Business Corporation (IPBC), will take 51 per cent.
The remaining nine per cent of shares will be spread between the PNG Sustainable Development Program and superannuation providers Nambawan Super, Nasfund and GEMS (PNG).
"This is an exciting venture and an important milestone in the new relationship Fiji is building with Papua New Guinea," Mr Bainimarama said.
"We are pursuing closer economic ties with the view of eventually creating a single market for the countries of the Melanesian Spearhead group."
The Vodafone deal is part of a broader package of economic ties.
PNG and Fiji will engage in annual trade talks and relax visa requirements for travel between the two nations, while PNG will hire Fijian public servants to bolster its ailing public service.
"We will be sending a team to go to Fiji within this year to start recruiting Fijians to come and work here to take up positions where we have a huge chronic shortage in our public service structure," Mr O'Neill said.
He also announced PNG will grant 50 million kina ($A22.2 million) in two tranches to Fiji to help it prepare for elections in March 2014.
The pair did not take questions from the press.
Mr Bainimarama arrived in PNG on Monday for a four-day state visit.