Niue is to withdraw its application to host the Pacific Islands Forum next year.
The island had earlier sought backing to hold it after losing the hosting rights in 2004 when Cyclone Heta wrecked much of its infrastructure, including accommodation facilities.
This year's summit was to be held in Tonga but the death last month of King Taufa'ahau Tupou the 4th resulted in the meeting being switched to Nadi in Fiji.
Tonga now wants to hold it next year and Niue's premier Young Vivian says his government is prepared to stand aside.
"'Under the circumstances I believe that it is the Pacific Way to give way to Tonga, because it's been unfortunate."
Young Vivian says Niue will be keen to hold the event in 2008.