New Zealand is to spend tens of millions of dollars improving transport links in Solomon Islands Western Province.
The aid spending will include work on runways at Munda and Nusatupe and key roading in the province, which was hit by a destructive earthquake and tsunami four years ago.
The New Zealand foreign minister, Murray McCully, and his Solomon Islands counterpart, Peter Shanel Agovaka, signed the deal in Auckland.
Mr McCully says both countries have agreed to being more accountable for the delivery and management of the aid programme, which also focusses on fisheries development and improving public sector performance.
He says New Zealand will also continue to work to raise literacy and numeracy rates at primary school level and to increase the number of certified teachers.