The European Union sees scope to team up more with Australia and New Zealand on foreign aid projects as it shakes up its relations with Pacific island countries.
The EU will soon start negotiating a new partnership agreement with developing Pacific island countries, to replace an existing deal which also covers Africa and the Caribbean and expires in 2020.
Pascal Lamy, a former European Union commissioner for trade and former head of the World Trade Organisation was in Sydney on Thursday following talks with officials in Noumea and New Zealand.
Mr Lamy said there was ample scope for further cooperation with Australia and New Zealand because of strong trust levels.
"We roughly think alike, and we have good reasons to act alike, given that we are also under budgetary restraints," he told AAP.
He said oceans, fisheries, and climate change resilience would be priority areas along with regional security, renewable energy, health and education.
Pacific island nations are considered among the most vulnerable in the world to climate change as they grapple with rising sea levels and increased frequency and intensity of cyclones and storms.
Mr Lamy said the new agreement would reflect the changing strategic environment, alluding to the increased role of China.
China's influence in the Pacific is growing and between 2006-2016 200 aid projects were showered with $US1.8 billion.
According to a Lowy Institute interactive tracker map, Chinese aid to Fiji has already gazumped Australia's contribution.
Beijing's aid to Samoa and Tonga is close to outstripping Canberra's assistance.
Mr Lamy said the new deal would also reflect the United Nations' sustainable development goals.
The EU allocated 800 million euros ($A1.1 billion) in aid to Pacific island countries between 2014-2020
There are half a million EU citizens living in the South Pacific.
New Caledonia is expected to hold a referendum on whether to seek independence from France in 2018.
